China’s engagement in Kenya continues to grow exponentially. According to latest Diplomatic cables released by whistle blowing Wikileaks,China enjoys a large trade surplus with Kenya; as exports are reported to have increased by more than 25 percent every year from 2004 to 2008. The China National Offshore Oil Company (CNOOC) is drilling for oil in the Kenyan Isiolo region. China may be a potential partner in the development of the new mega-port at Lamu. In addition, China is alleged to be heavily involved in various infrastructure projects across Kenya primarily with roads. China is also providing weapons to the GOK in support of its Somalia policies and increasing their involvement with the Kenyan National Security and Intelligence Service (NSIS) by providing telecommunications and computer equipment if the leaked cables are anything to go by. Recently, China signed an economic and technical cooperation agreement with the GOK providing new development grants. To date, China and the U.S. do not collaborate on development projects in Kenya. .
China is said to enjoy a large trade surplus with Kenya, exporting more than 30 times its imports. For the year 2008, China is said to have exported $917 million of goods to Kenya while China imported $29 million worth of Kenyan goods. China’s exports in 2008 grew by 39 percent over 2007 capping the fourth straight year of at least 25 percent export growth, including a 54 percent increase in 2007 and a 79 percent increase in 2005. China is now the third largest exporter to Kenya after the United Arab Emirates, which principally exports oil to Kenya, and India. In comparison, the U.S. exported $440 million worth of goods to Kenya in 2008 while importing $343 million worth of Kenyan goods.
Most Chinese companies working in Kenya tend to import a substantial number of Chinese workers. This importation of labour from China tends to limit the number of Kenyans who directly benefit with wages and knowledge transfer from the projects. The low Chinese bids on major projects also push local firms out of the process, especially in infrastructure areas where capacity building of local firms would be useful. In addition, the leaked cables claim that the Kenya Wildlife Service (KWS) noticed a marked increase in poaching wherever Chinese labour camps were located and in fact set up specific interdiction efforts aimed to reduce poaching KWS also reports that 90% of the ivory smugglers detained at JKIA are Chinese nationals.
The U.S. mission in Kenya has no current or pending development partnership arrangements with the Chinese government or any informal collaboration at the program or project level. The government of China does not participate in donor coordination in Kenya. Donors have encouraged the Kenyan government to bring China into the donour coordination process, but no progress has been made to date. While we do not recommend it, a potential area for collaboration could include agricultural development, a USG strength and an area of Chinese interest in Africa. However, the GOC does not participate in the multilateral agricultural donors group in Kenya. The GOC could be invited to join this donors group, predicated on their willingness to sign a Memorandum of Understanding ensuring their support of Kenya’s long term agriculture strategy. Going with what Wikileaks say,the World Bank recently announced a new initiative to work in cooperation with Chinese infrastructure development in Africa. This new effort seems to be aimed at working with China and African countries to maximize the benefits of Chinese development aid to the African people.
approached cautiously as there appears to be little dovetailing of our interests to date.
According to the leaked cables,US Ambassador to Kenya Michael Rannerberger claim that the government of China has been silent on the implementation of the reform agenda, which the United States of A merica considers essential to Kenya’s future stability and prosperity.Rannerberger also claim the GOC turns a blind eye to the flooding of the Kenyan market with Chinese counterfeit goods, such as batteries, which directly damage U.S. market share here; and the GOC has not demonstrated any commitment to curb ivory poaching..." We expect China’s engagement in Kenya to continue to grow given Kenya’s strategic location. If oil or gas is found in Kenya, this engagement will likely grow even faster. Kenya’s leadership may be tempted to move ever closer to China in an effort to shield itself from Western, and principally U.S., pressure to reform. Given the possibility of a backlash by the Kenyan people against China, perhaps over the issue of imported Chinese labor or mishandling of natural resources, there may be benefits to keeping our distance, at least publicly, from China." Michael Rannerberger is quoted by the Wikileaks.
Kelvin Mwangi,
Nairobi.
for more details on the leaked cables visit http://wikileaks.ca/tag/KE_0.html
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