A number of German firms are eyeing investment in Kenya’s food processing segment in a move that could significantly raise the value of the country’s exports.
Kenya’s exports to Germany are mainly coffee beans, tea leaves, and horticultural crops which fetched Sh7.6 billion in 2011, dropping from Sh7.7 billion the previous year.
“German firms are looking for investment opportunities in agriculture and food processing that will boost value addition in commodities with established markets,” said Ingo Badoreck, the representative of German Commerce and Industry in Nairobi.
The Germans scouting for investment opportunities are expected to forge partnership with local investors during the “Made in German Trade Fair” slated for Nairobi September 25-27.
The Germans are also interested in the textile sector, especially at the country’s export processing zones where firms enjoy quota-free and duty-free access to the US market.
“We know Germany is strong industrially and hope to have some of its technology at the Export Processing Zones (EPZ),” said Jonathan Chifallu, the public relations manager at the EPZ Authority.
On the import side, German firms hope to raise earnings from Kenya by introducing new machinery and equipment including textile technology, security gadgets, and agricultural machinery.
“The main aim of starting a trade fair here was to open up the market for German companies while also creating opportunity for Kenyan firms to get German contacts,” Mr Badoreck said Tuesday at the launch of the Made in Germany trade fair.
The fair comes hardly a year after the German Chamber of Commerce established a Nairobi unit to chart its foray into the Eastern Africa region.
Officials from the country, one of the top financiers of the East African Community integration, said Kenya was attractive as a business hub given its direct link to the region’s free trade area (Comesa), EAC custom union and investment in cross-border infrastructure.
“We can only expect trade relations with Germany to deepen as Kenya sets up 47 counties which will definitely benefit from its (Germany’) experience and technology,” said Joseph Kosure, head of the bilateral division at Kenya’s Trade ministry.
But even as Kenya counts on its 50-year friendship with Germany to boost inflow of foreign direct investment, a number of prospective investors have adopted a wait-and-see attitude as the country prepares to hold its historic General Election.
With the 2008 post-election chaos still etched on their minds, most investors are said to have opted to put their plans on hold until after the March 4 polls, ignoring the government’s pledge of continued political and economic stability.
“We know many investors who had expressed interest in the country are planning to come after elections, but this will be too late, a whole quarter of the year gone,” said Pius Rotich, the marketing manager at the Kenya Investment Promotion.
“We keep telling them that elections will come and pass like any other calendar activity,” he added. While presidential contenders have pledged to compete peacefully, key investors cite the coming elections as one of the sources of uncertainty.
Source :businessdailyafrica.com
