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,
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 approximately 4500-5000 people in Kenya. German foreign direct investment accumulated to 100 Mio. Euro as of 2016.
In 2017 Germany exported goods worth 253 Mio. Euro to Kenya and imported goods worth 92 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)
The “German Embassy Green Economy Cycle” (GEGEC), initiated by the Embassy and carried out in close cooperation with the Delegation of German Industry and Commerce in Kenya, reached more than 1,000 representatives of companies, international organizations, embassies, public sector and government in Kenya and connected them with German business representatives in events in the form of workshops, conferences and technical trainings in the years 2016 and 2017. There were various events within the 2016 and 2017 GEGEC in the areas of sustainable construction, sustainable agriculture, waste management, technical vocational training programs, green entrepreneurship and its funding opportunities. These events provided a platform for exchange between the participants on solutions for achieving economic growth while considering 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.
Due to the success of the 2016 and 2017 GEGEC, the GEGEC continued in 2018 under the theme: “Success stories involving German participation for a Green Economy in Kenya”. Highlights of the 2018 GEGEC were the display of the Exhibition “The Energiewende – Transforming Germany’s Energy System”, which was opened by the ambassador and the executive directors of UNEP and of UN-Habitat, in Nairobi and a conference on partnerships between Germany and Kenya in the fight against climate change (“Switching on” Green: Partnerships with Kenya for Combating Climate Change). Other events included an expert meeting on sustainable waste management and a Masterclass on “Big Data” in connection with green economies. Pending are another site visit to a hydropower plant as a successful example of green economy in Kenya and the publication “Guide to green economy in Kenya”, which aims to make the examples of a green economy presented in the GEGEC accessible to a wider audience.
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 key role in this plan. Kenya’s commitment to renewable energies and to the Paris Climate Accord of 2015 prove its devotion to tackling global climate Change.
The Kenyan government has set itself the ambitious goal of providing all citizens with access to energy, as well as improving economic productivity in the near future. The target for 2020 was initially to provide 65% of households with access to energy. However, while in 2011 only 25% of Kenyan citizens had access to energy, in 2017 the rate of electrification had already reached 70%. The new target for 2020, thus, is “universal” access to electricity. 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.