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Economic Division

Option für Wirtschaftsbeziehungen

Option für Wirtschaftsbeziehungen, © Colourbox

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Kenya has proven to be one of Germany’s most important economic partners in East Africa. Opportunities for German investment can be found in various sectors such as in infrastructure, telecommunication, transport, renewable and fossil energy, mechanical engineering as well in agriculture.

Bilateral Economic Relations

Kenya has proven to be one of Germany’s most important economic partners in East Africa. Opportunities for German investment care rife in various sectors such as in infrastructure, telecommunication, transport,

GABS
Former Foreign Minister of Kenya, Dr. Amina Mohammed, and Brigitte Zypries, former Federal Minister for Economic Affairs and Energy, during the German-African Business Summit in Nairobi in February 2017. © AHK

renewable and fossil energy, mechanical engineering as well as agriculture. Germany’s interest in the Kenyan economy has grown in recent years, demonstrated by the increased presence of German companies in Kenya.  Currently, about 120 German companies employ over 4500 people. German foreign direct investment accumulated to 98 Mio. Euro as of 2015.

Bilateral trade volume has notably been on the surge in recent years. In 2016 Germany exported goods worth 336 Mio. Euro to Kenya and imported goods worth 168 Mio. Euro. The most significant German exports include machinery, food products as well as motor vehicles and the relevant spare parts. German imports from Kenya include agricultural products such as flowers, tea, coffee and vegetables.

German-Kenyan conventions include a Double Taxation Agreement that commenced in 1980 and an International Investment Treaty that  was enforced in the year 2000.








Promotion of foreign trade

Foreign Trade promotion is jointly implemented by the German government and the private sector. To offer the best support to German companies conducting business in Kenya, the Embassy inter alia works closely with the Delegation of German Industry and Commerce (AHK) and the Germany Trade and Invest GmbH (GTAI).

The Embassy coordinates the joint efforts between the AHK and the GTAI, and sustains contact to the government and other relevant institutions in Kenya. Moreover, it commits to improving market access for German companies and direct support where needed. This especially applies to small and medium sized companies.

German Embassy Green Economy Cycle (GEGEC)

In 2016, for the first ”German Embassy Green Economy Cycle (GEGEC)“ kicked off. The event was organized and carried out in close cooperation with the Delegation of German Industry and Commerce in Kenya with the aim of discussing solutions, sharing experiences and working together to create a more sustainable world.

In the following year, GEGEC continued under the theme: ”Enabling the Adoption of Climate Friendly Technologies for Private Industry Projects in Kenya“. There were various events within the 2017 GEGEC in the areas of

GEGEC
Deputy Ambassador and Head of Economic Affairs, Michael Derus, during the German Embassy Green Economy Cycle. © AHK

sustainable construction, sustainable agriculture, waste management, technical vocational training programs, green entrepreneurship and its funding opportunities. These events provided a platform for the exchange of experts and entrepreneurs from Germany with companies, universities and political institutions in Kenya. The dais focused on solutions for achieving economic growth taking into consideration the objectives of climate and environmental protection through climate-friendly technologies that contribute to a low-carbon economy as well as sensitizing stakeholders on the need for green technologies, innovation and economic strategies. The successful project, which brought more than 1,000 interested participants in the last two years, is to continue in 2018.

Energy

In its economic blueprint, “Vision 2030”, the Government of Kenya has set out to ensure its citizens cleaner and improved standards of living. Renewable energies play a great stake in this plan. A pioneer in the field of renewable energy and the commitment to the Paris Climate Accord of 2015 prove Kenya’s effort to curb effects of global climate change.

Solar-hybrid mini-grid in Talek, Narok County
German Development Cooperation is contributing to an environmentally-friendly and secure energy future in Kenya. © GIZ/Alex Kamweru

The Kenyan government has likewise set itself the ambitious goal of providing all citizens the access to energy, as well as improving economic productivity in the near future. Due to the fact that the country has seen a surge of investments into renewable energies in recent years, the electrification ratio in the last five years has increased from connecting merely 24% to nearly 65% of Kenyan households. Yet, many obstacles still lie ahead before universal connection can be achieved. These include foremost a rapid population growth rate and poor rural infrastructure, which currently is hindering an effective proliferation of power supply.

Renewable energy contributes 85% of Kenya’s energy mix. The main sources of electricity generation include geothermal power stations and hydropower plants. Geothermal power has proven to be quiet the success.  With the capacity of producing more than 550 Megawatt, Kenya ranks eighth in the generation of geothermal power. Geothermal power is however not the only source of renewable energy that Kenya is currently investing in. The decrease in prices of photovoltaic facilities on the global market has led to  enhanced demands in the solar energy market in Kenya. Alternative sources of energy production in Kenya also include wind power.  One of Africa’s biggest wind parks is due to open in the near future in Northern Kenya.