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China’s rising import ceiling could take away Kenya’s Vision 2030 blueprint

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China- Kenya imports are likely to hit the 400 billion mark two years after breaking the 300 billion ceiling. This, is largely on account of huge shipments of building materials from China for building the SGR as well as poll gadgets prior general elections this year.

China took the lead from India, formerly the largest source of imports for Kenya, which according to reliable sources dropped by 26 per cent to Sh187.33 billion from Sh253.19 a year earlier. The continuing trends of importing cheap and subsidized products from the Asian hub will further the huge trade deficit between the two countries.

Before ousting major importers like United Arab Emirates (oil), the United Kingdom, South Africa, Saudi Arabia, the United States, Germany, Netherlands and France, China was known for imports like mobile phones and household goods. With the increased appetite of infrastructural growth, China is having a ball in Africa with top beneficiaries being Kenya Uganda and Senegal.

The rising trade deficit is however nothing to be happy about, maybe reasons we have seen President Uhuru Kenyatta negotiate with Beijing to open their market in order to accommodate African products and more so Kenya’s.

As at last year April, Chinese imports accounted for a fifth of Kenya’s import bill only at 320Billion worth of imports, lower than todays. Experts and Analysts have however raised the red flag saying that the fast widening import bill on Chinese-manufactured products could be bad for the local economy, in quest to industrialize. Kenya would only result industrialized but handicapped due to less currency inflows.

The country’s exports declined marginally in 2016 to Sh578.1 billion compared to Sh581 billion the previous year.

Quoting Uhuru Kenyatta, the only leader from East Africa to attend the Belt and Road regional infrastructure programme told the Financial Times that if China’s win-win strategy is going to work, it means that, just as Africa opens to China, China must also open up for Africa.

This means, the situation could be salvaged, but also Kenya could chose to re-think the trade policy and lock out imports locally available.

What is your opinion on the topic?
Melissa Daniels
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