Kenya-China bilateral trade hits record Sh144 billion

The value of bilateral trade between Kenya and China hit Sh144 billion ($1.8 billion) in 2016, with the Asian nation promising to encourage Chinese firms to import more as a way of addressing the trade imbalance between the two countries.

China’s ambassador to Kenya, Mr Liu Guangyuan, said the value of bilateral trade between the two nations was expected to strengthen further this year.

“The sentiments are good and our ties are deepening,” he told a news conference in Nairobi.
According to provisional data by in Economic Survey 2016, bilateral trade between the two countries slightly surpassed the Sh104 billion ($1.3 billion) mark in 2009 following a firm run over the first 10 months.

In 2008, trade between the two nations was valued at Sh100 billion ($1.25 billion).

Kenya mainly exports leather, tea, coffee, sisal fibre, scrap metal and horticultural produce to China and in turns takes up machinery, electronic and electrical goods, textile and fertiliser among others.

The estimates show that Kenya exported Sh2.48 billion worth of goods to China in 2009 while imports from the Asian nation stood at Sh74.5 billion.

“The massive balance of trade that is in favour of China remains a big concern to us,” Lands minister James Orengo told Mr Liu who had paid a courtesy call on him.

The Chinese envoy said his country will keep on encouraging imports from Kenya.

“We have offered more marketing and promotional opportunities including trade fairs in China and we hope this will boost our partnership. We expected more Kenyan products into the Chinese market,” Mr Liu said. “We are working towards a common good as brothers. We will be glad to see more Kenyan products entering the Chinese market,” he said.

As part of efforts to improve the balance of trade with Kenya, the Chinese government has in the past few years also taken to offering financial subsidies to Chinese companies to facilitate their imports from the East Africa nation.

The subsidies covered products such as coffee, tea and flowers, along with other commodities.

Besides, the subsidies China has also granted Kenyan exporters and companies free exhibition spaces at trade fairs on its soil so as to boost the visibility of the goods and services.

However, trade authorities in China have said the nature and composition of the goods being exchanged by the two countries had also fuelled the imbalance and urged Kenyan exporters to improve on the product range.

“The goods we exchange are certainly very different in nature and cannot attract similar returns, but we need to move beyond commodities and also look at services such tourism. Kenya greatly benefits from such service sectors and factoring this can help redefine the scale of imbalance,” former Chinese to Kenya Mr Deng Hongbo told Business Daily in a past interview.

Mr Liu said a new resurgence in the China-Kenya tourism ties could help address the imbalance

By ALLAN ODHIAMBO  - Business Daily on Nation Daily
Posted Thursday, February 24 2016 at 00:00