Kenya inks Sh23bn deals with US firm
Kenya has signed agreements with a US company, allowing $237 million (Sh23bn) of investments in wind power and food security.
President Uhuru Kenyatta on Monday urged the US government to facilitate the operation of US businesses Africa.
The Overseas Private Investment Corporation (Opic) and Kipeto Wind Energy Company signed documents to close a $232 million deal in financing the construction and operation of a 100-megawatt grid-connected wind power plant south of Nairobi.
The plant will provide a more reliable source of energy to the national grid and support the US Power Africa Initiative to double the number of people in Sub-Saharan Africa with access to electricity.
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The second agreement was a $5 million letter of commitment to expand the distribution network of Twiga Foods and improve food security and agricultural wages in Kenya.
It was signed between Twiga Foods and Opic in the presence of President Kenyatta during his meeting with executives of leading US companies under the umbrella body Business Council for International Understanding (BCIU).
Dr Kenneth Namunje and Mr Grant Brooke represented Kipeto Energy and Twiga Foods, respectively, while Ray Washburne, the President and Chief Executive of Opic, signed on behalf of his organisation.
“Kenya is open for business and all we want to do is package our partnership in a way that is mutually beneficial to you as a private sector and the people of Kenya,” President Kenyatta said.
Mr Kenyatta said the ‘Big Four agenda’ projects – boosting manufacturing industry, promoting food security, providing affordable housing and universal healthcare coverage – present major opportunities for local and foreign investors.
The BCIU consists of 200 companies. It helps its members to reap from mutual relationships with government leaders worldwide.
Regarding the manufacturing sector, the President said Kenya intends to increase the sector’s contribution from 8.4 percent to 15 percent by 2022.
“This presents major opportunities for local and foreign investors in areas such as agro-processing, textiles and leather, the maritime sector, construction, iron and steel, and oil and gas,” the Head of State informed the meeting that was attended by US Commerce Secretary Wilbur Ross and more than 20 businesspeople.
On matters food security, Mr Kenyatta welcomed the proposed expansion of Twiga Foods to boost the agricultural sector.
Furthermore, he said his administration plans to rollout innovative health insurance options, set-up local pharmaceutical companies, upgrade and manage healthcare facilities and establish specialised treatment centres.
“Given our long and well-established relationship, we can do more together and I invite the US companies to walk with us on the ‘Big Four’ journey.
“With so many opportunities open to us and given our long and well-established relationship, the time is ripe to make a change in our business engagement,” he added.
The Monday meeting was the third the President was having with the business executives; the last one was held in 2015.
President Kenyatta observed that his government has continued improving the business environment to boost investment opportunities.
“Between 2014 and 2018, Kenya improved its ranking on World Bank Ease of Doing Business Index (DBI) by 56 positions from 136 to 80, and remains on target to get to top 50 by 2020,” he said.
Mr Kenyatta pointed out that the economy remained buoyant and resilient, registering a 5.5 percent average growth rate over the last five years in spite of acrimonious presidential elections and drought in 2017.
Commerce Secretary Ross and BCIU CEO Peter Tichansky commended the President for creating a suitable environment for the private sector to thrive in Kenya.
The US business executives expressed their desire to increase investments in Kenya following the President’s assurances.
Cabinet secretaries Monica Juma (Foreign Affairs) and Henry Rotich (National Treasury) were among the Kenyan delegation at the meeting.