Kenya is yet to tap into a $443 billion (Sh57.1 billion) funding by the African Export-Import Bank (Afreximbank) and Africa Finance Corporation (AFC), earmarked to spur industrial growth across the continent even as other nations had a bite of the pie.
Last year, Afreximbank, and its implementing partner ARISE IIP (a Pan-African integrated industrial park infrastructure developer and operator), outlined a vision for Kenya’s industrial development, including massive investments in industrial parks in Mombasa (Dongo Kundu), Lamu, Busia, Eldoret, Isiolo and Naivasha.
The funding was anticipated to help prop up Kenya’s economy through investments in Special Economic Zones (SEZs) and industrial parks. ARISE IIP would help de-risk investors in areas gazetted as public SEZs by leasing land within the SEZs and building the necessary infrastructure, including roads, sewer lines, and industrial sheds.
Kenya is yet to tap into the funds and break ground for these projects, more than a year later even as other countries forged ahead with integrated industrial parks projects under SEZs supported by Afreximbank.
“There is no uptake on that. We have gone slow on that facility,” Chris Kiptoo, the Principal Secretary for the National Treasury told Business Daily without giving details when contacted about the project.
Countries such as Rwanda, Malawi, Ethiopia, Togo, Benin, the Democratic Republic of Congo and Côte d’Ivoire have already made some milestones in the Afreximbank-backed SEZ projects.
Kenneth Chelule, the chief executive officer of the Special Economic Zones Authority, downplayed the matter noting that the funding is being disbursed in phases.
“Those conversations have begun verbally. We are in the early days,” he said, noting that it takes about a year or two to finish such transactions.
Congo, for instance, signed a Memorandum of Understanding (MoU) with ARISE IIP in 2022 to develop two industrial zones, and construction is ongoing at the Kin Malebo Industrial Park.
Similarly, in Gabon, wood processing activities in the Gabon Special Economic Zone (GSEZ) commenced and the zone has attracted over 16,000 jobs and 12,000 investors, transforming Gabon from a log exporter into the world’s second-largest producer and exporter of veneers, and the first in Africa.
In Benin, the Glo-Djigbé Industrial Zone (GDIZ) is operational and 100,000 jobs are expected in the next few years from processing cashew nuts and shea butter, and garment manufacturing.
Insiders say that while these nations have aligned their economic policies with international investors to become SEZs and industrial parks are crucial to the success of President William Ruto’s Bottom-Up Economic Transformation Agenda (BETA).
The Dr Ruto government expects these zones to uplift local economies by providing the infrastructure necessary to support small and medium enterprises (SMEs), create new value chains, increase exports, and stimulate industrial growth, particularly in the manufacturing and agricultural sectors.
Connecting rural areas with industrial hubs, SEZs and industrial parks would also ensure that the benefits of these developments are widely distributed, promoting more inclusive economic development.
In regions like Dongo Kundu, Busia, Isiolo, and Naivasha, where poverty rates remain high, these SEZs and industrial parks could be game changers. By providing infrastructure, investment, and skilled job opportunities, SEZs would drive development in areas historically marginalized from industrial growth.
The Dongo Kundu SEZ, for instance, was envisioned as a game-changer for the coastal region, offering a strategic location for industries involved in manufacturing, logistics, and agro-processing.
The project was set to enhance Kenya’s competitiveness in global trade while providing opportunities for local communities. But like other planned SEZs in Busia, Eldoret, and Naivasha, it remains in the planning stage, with no clear timelines for implementation.
