The FINANCIAL — Uhuru Kenyatta, the President of Kenya, declares the organization of distinct economic zones, based on China`s experience.
According to him, they are to be established near newly-built transport links. Kenyatta emphasizes it is a critical issue for fighting unemployment in his country.
As Tuko Kenya reports, the President invoked China to rebalance a progressively more skewed trade relationship between Chine and Africa. He also added that China should do more to seize a huge trade deficit.
Owing to the price fall in such local goods as copper, iron ore, oil, and cocoa, Africa’s trade balance with China has been determinedly moving into deficit. For example, in 2015, more than 50 African countries had a 35 billion dollars deficit with China on the whole trade of over 170 billion dollars. Such figures were declared at Johns Hopkins University by the China-Africa Research Initiative.
Undoubtedly, Kenya is the most developed economy in East Africa. It means that it depends less on commodities than plenty of other African countries. However, in 2015, Kenya imported almost six billion dollars worth of goods from China but exported just 99 million dollars of assets in return.
Uhuru Kenyatta attended the forum of China’s flagship Belt and Road regional infrastructure program that took place last weekend in Beijing. During the discussion, the President declared that he would do his best to push the process of increasing China-Africa trade. He also added that if Beijing wanted its win-win strategy to work, it would have to realize finally that Africa was open up to China, and China should also open up to Africa in its turn.
Under its popular Belt and Road initiative, China has been seeking to modify the ancient Silk Road recently. It linked Asia with Africa and Europe. Kenya is the important point on its map due to Indian Ocean coast. In 2009, China left behind the United States as Africa’s major trading associate.
Moreover, by inviting manufacturers from China to his country, the Kenya`s President emphasized that by doing this he planned to follow the lead of Ethiopia. As China continues to grow its power worldwide, African people might get plenty of jobs in such labor-intensive industries such as shoes, textiles, and agro-processing as one way of fighting China-Africa trade imbalance.
At the same time, the opposition is not so happy about Kenyatta`s hopes on improving trade with China. According to critics, the President has already taken too much money from China to finance various projects that will probably never be paid off. In particular, they point to the fact that Kenyatta`s government borrowed more than 3.6 billion dollars for the leg of a new rail line between Mombasa and Nairobi, which would in time extend to Uganda, Rwanda and the Atlantic coast in the Democratic Republic of Congo. But will this event take place in June 2017, as previously announced by Kenya`s President?