German firms are keen to invest in machinery, technology and skill development as they look to share the spoils in the manufacturing industry currently dominated by the Chinese. The sector’s contribution to the economy has stagnated at about 10 per cent for years.
Germany, a global industrial powerhouse, whose wealth is estimated at $3.73 trillion (Sh386.32 trillion), is pushing for investment deals under the German African Business Summit, underway in Nairobi, riding on the Western European country’s G20 Presidency.
Germany’s visiting Economic Co-operation and Development minister Gerd Müller said Kenya is key to its change in strategy – shifting co-operation with Africa “from aid to trade”.
“Public money has to mobilise private investment, for instance through government guarantees. Private investment has to be increased and protected against risks. We need a paradigm shift, a new dimension of cooperation,” Müller said.
This underscores the dollar economy’s deepening interest in the region.
German Economic Affairs minister Brigitte Zypries said Africa is a major priority for his government, as the country eyes more opportunities in sub-Saharan Africa “for investing, trading, learning and connecting – both for business and government”.
Treasury Cabinet Secretary Henry Rotich and Foreign Affairs’ Amina Mohamed and their German counterparts yesterday signed agreements which include a joint East African-German university of applied sciences. They also agreed on a joint initiative to enhance technical and vocational training in Kenya.

“We have a double taxation agreement signed 20 years ago but obviously there has been many changes especially on investment and trade, but we are keen to ensure they benefit both economies,” Rotich said.
Last year alone, five new major companies came to Kenya, including automaker Volkswagen which reopened its assembly plant in Thika after a four-decade hiatus.
The value of imports from Germany to Kenya dropped to Sh47.3 billion in 2015, from Sh47.4 in 2014, the Kenya National Bureau of Statistics data shows. Exports to Germany were valued at Sh12.5 billion, an increase from Sh10.8 billion in 2014.
There has been a tremendous increase in China’s investments in Kenya. Mega deals in infrastructure development has seen China become the country’s largest bilateral lender, having overtaken Japan in early 2014.
Official data from the National Treasury, published in the Central Bank’s Quarterly Economic Review, shows Kenya owed China about $3.1 billion (about Sh321billion) as at last June.
Source: The Star

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