Home Business Kenya, UK sign Sh20bn in deals on Uhuru visit

Kenya, UK sign Sh20bn in deals on Uhuru visit

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Kenyan and the United Kingdom government officials have inked deals worth Sh20 billion on the first day of President Uhuru Kenyatta’s three-day tour that would be channelled mostly through the private sector.

The deals are set to unlock projects in housing, manufacturing and energy and setting up Nairobi as the regional investment hub with links to London, the world’s leading financial centre.

Officials did not give a breakdown of the Sh20 billion deals instead citing private companies announcements including British insurer Prudential and Kenyan mining firm Mayflower Gold that unveiled plans to set up a presence in Nairobi and London.

UK Foreign Secretary Dominic Raab announced a Sh5.2 billion of UK Aid is to be matched by Sh3.5 billion of private investment to finance 10,000 green affordable homes for Kenyans and a Sh550 million new funding to accelerate Kenya’s climate transition.

“As President Kenyatta begins his three-day visit to London, the UK has announced Sh20 billion of new government and private investment in Big Four projects, including affordable housing and manufacturing,” said the British High Commission.

Britain’s focus on linking UK firms to opportunities in Kenya follows policy shift from direct lending to channelling investments through its development assistance arm, Department for International Development (DFID), which funds directly to the private sector non-state actors.

The UK’s DFID and its investments institution CDC have been channelling loans directly to private sector companies like Athi River Mining, Brookside Dairy, Equity Bank, Garden City and M-Kopa solar.

Kenya paid of all direct loans owed to Britain last year after wiring Sh35.3 million to London in June according to data from the National Treasury.

Direct United Kingdom loans have been on a steady decline and have been at less than a billion for the last five years, indicating the waning influence of London in East Africa’s largest economy.

Former British Prime Minister Theresa May visited Kenya in 2018, the first sitting Premier in 30 years to tour Kenya, to boost bilateral relations after Brexit.

This has seen Kenya sign a bilateral Economic Partnership Agreement ensuring access to the Sh49 billion export market while the UK could still access Kenya’s Sh29.3 billion market.