Kenya smoothing way for growth

Investors in southern China urged to get involved as province signs raft of trade and investment deals

Kenya is working to make its business environment more attractive and easier to access as it attempts to attract foreign direct investment, particularly from China, according to a senior official.

Moses Ikiara, managing director of Kenya Investment Authority, says various agencies have been set up to remove obstacles for potential investors.

"We have a Cabinet committee tracking what is happening and a dedicated business environment delivery unit," he says, adding that the government is in the process of opening a one-stop shop, where investors can access information on opportunities by sector and county.

Ikiara says the nation is focused on tackling corruption and enhancing security as well as offering tax incentives to foreign companies, such as through special economic zones.

Kenya signed eight trade and investment agreements with the government of Guangdong province in southern China this month. The deals aim to highlight the diverse investment opportunities that stem from the East African country's ongoing industrialization.

"Every sector has a strategy that is aligned with Vision 2030, so there's no uncertainty on where the country is headed," Ikiara says.

Vision 2030 is a long-term development plan to transform Kenya into an industrialized, middle-income nation with a clean and secure environment over the next 15 years.

However, Ikiara says to achieve its objectives, investment as a percentage of GDP needs to rise to, and be maintained above, 32 percent until 2030. Currently, the figure stands at 24.7 percent.

Kenya offers many investment opportunities for Guangdong investors, including in manufacturing, electricity, information technology and the internet, construction, and logistics and transportation, he says.

In agriculture, for instance, he says, there are opportunities to improve yields through modern and innovative technology and adding value to produce, he says.

Ikiara singles out the government's Galana-Kulalu irrigation project, which aims to optimize productivity on more than 400,000 hectares between Kilifi and Tana River counties over the next five years. This involves targeted investment in crops, livestock, fisheries and eco-tourism.

"Investors will be required to produce and process the products," he says, adding that cold storage infrastructure is needed for milk, meat, fruits and vegetables to reduce the 40 percent or so of produce that is wasted due to inadequate handling.

Freshwater is also scarce, with only 670 cubic meters per capita, below the international standard of 1,000 cu m. This is despite vast reservoirs being discovered in the north part of Kenya in 2013.

"We need investors who can construct dams and other water systems. This is in addition to bringing in rainwater harvesting technologies and distributing the resource with minimum wastage," Ikiara says.

He says the nation also wants to have a robust, diversified and competitive manufacturing sector and to increase its contribution to GDP by at least 10 percent a year.

"The East African market is dominated by imports from outside the region and therefore there is a potential market for Kenyan products," he says.

Ikiara calls on Guangdong investors to set up free trade zones, industrial parks, free ports, science and technology parks, agricultural zones, tourism and recreational zones, and business service parks.

Kenya aims to become a top-10 tourist destination offering a high-end, diverse and distinctive visitor experience, he says.

"We're targeting at least 3 million international tourists a year, up from the current 1.5 million to 1.8 million. So we have opportunities for convention centers, resorts and accommodation."

In the energy sector, Kenya authorities are working at generating 5,000 megawatts of electricity in less than three years from coal, geothermal, liquefied natural gas and wind projects.

Major investment opportunities also lie in the residential housing construction, Ikiara says, adding that the nation is short of 150,000 to 200,000 units, especially in middle- and lower-income segments.

Zhu Xiaodan, the governor of Guangdong, says his province will use the agreements to strengthen industrial skills cooperation with Kenya.

"We will continue to support Guangdong businesses to get involved in investment opportunities," he says. "We will also deepen agricultural cooperation in terms of agriculture processing and storage, technology and quality control."

Guangdong, which is seen as a symbol of China's opening-up and reform policy, reported its GDP at $1.2 trillion last year, accounting for 10.8 percent of the national total.

The province is home to production facilities and offices of a wide range of Chinese and foreign corporations, whiles it capital, Guangzhou, hosts the annual Canton Fair, the world's largest import and export expo.

edithmutethya@chinadaily.com.cn

(China Daily Africa Weekly 09/16/2016 page26)