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UG to host Afreximbank lucrative head office as Nairobi dithers

rotich

Treasury CS Henry Rotich. FILE PHOTO | NMG

Kenya enters 2019 with regret after its reluctance to grant the African Export Import Bank (Afreximbank) diplomatic status forced the agency to move its Sh3 billion regional headquarters to Uganda from this year, denying Nairobi the benefits of hosting such an international organisation.

The Treasury had earlier in 2016 indicated that Kenya would finally sign the deal, paving the way for establishment of the regional headquarters in Nairobi. The plans had been in the works for over three years.

Afreximbank, which finances and promotes African trade, has in the past decade become a significant player in Kenya’s economy, having financed big-ticket deals, including national carrier Kenya Airways.

Relocating to Kampala means all potential benefits of hosting such an office, including investment in buildings, rents, and employment, will now accrue to Uganda.

Observers also saw the loss of hosting rights to Kampala as a blow to President Uhuru Kenyatta’s efforts to create a regional financial hub in Nairobi.

Cabinet Secretary Henry Rotich had two years earlier said in a letter to Afreximbank that his office had completed a review of the agreement to set up the office and the same had been forwarded to the Foreign Affairs ministry for “finalisation.”

“This is to inform you that the Treasury has now completed review of the branch office agreement between the Republic of Kenya and Afreximbank after consultations with Mr Kudakwashe Matereke, regional branch manager for East Africa,” Mr Rotich said in a letter dated September 22, 2016.

“We have forwarded the agreement to the Ministry of Foreign Affairs for finalisation and to formally communicate to Afreximbank.”

But in July last year Benedict Oramah, the chairman and president of African Export-Import Bank, confirmed that the multilateral lender had opted to relocate to the Ugandan capital, Kampala, after Nairobi kept it waiting for more than three years for the necessary approvals.

Mr Oramah said the lender was set to sign a deal with Uganda before the end of the year to establish its regional branch in Kampala.