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Economy

Japanese loans to Kenya up 162pc as China goes slow

Ryoichi Horie
Japanese ambassador to Kenya Ryoichi Horie. PHOTO | DIANA NGILA | NMG 

Japan has loosened its purse strings, increasing loans to Kenya by 162 percent over the last year as China begins to go slow on its lending to African States.

National Treasury data show bilateral loans from Japan leapt from Sh52.2 billion ($503 million) in June, 2018 to Sh136 billion ($1.3 billion) by June, 2019.

By comparison, China’s bilateral loans to Kenya, which stood at Sh665.5 billion ($6.4 billion) by June had only grown 16 percent from Sh569.7 billion ($5.5 billion) in the same period last year.

The two countries have openly clashed over the Indo-Pacific passage which identifies "Kenya as a frontal state facing the Indian Ocean" and a strategic country for the geopolitical competition.

Last week while signing a Sh82.7 billion loan for the construction of the Mombasa Gate Bridge over Kilindini harbour which will kick off in 2021, newly appointed Japan ambassador to Kenya Ryoichi Horie said the investment reinforced Japan’s policy towards China on the Indian Ocean.

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“It is a central consideration for Japan that a key for stability and prosperity of the international community is the dynamism that is created by combining ‘two continents’ Asia that is rapidly growing and Africa that possesses a huge potential for growth,” and ‘two oceans’ by which we mean free and open pacific and Indian Ocean,” Horie said.

Japan is currently undertaking several projects including Ol Karia IV Geothermal and rehabilitation of units 1, 2 and 3, expansion of Mwea Irrigation scheme, Mombasa Area Port development project (Dogo Kundu bypass), Ol Karia Lesos Kisumu power transmission line, development of Mombasa Port phase II and III, and the expansion of Ngong Road.

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