Inside William Ruto's pitch for multi-billion business deals in the US
A bag of goodies and a strong pitch for investments in the country marked President William Ruto’s five day tour of the United States, the second trip in his 100 days in office.
Ruto, who for most part of last week attended the US-Africa Summit on ‘The Future of Africa’s Trade and Investment’, used the opportunity to market the country to the US moguls and top global corporate heads a move that signals his government’s near complete diplomacy shift from the East to the West.
At the end of his trip that was attend by senior government officials, including the Prime Cabinet Secretary Musalia Mudavadi, five cabinet secretaries and economic experts, the President managed to win over billions of dollars in direct and indirect investments from the government, and the corporate world including support for his biggest election pledge the Hustler Fund.
During the tour, the President called on the US to review its economic partnership with Africa, saying the continent must be regarded as an investment destination, and not a market for manufactured goods.
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In return, the US corporate world pledged billions in investment including Google pledging to use Kenya as its nexus for the African continent by establishing a product development centre in Nairobi to oversee Africa.
Key among the trade deals Ruto got was the support by executives to invest billions on innovating, accelerating, and scaling the Konza Technopolis and the Visa International support for the Huster Fund’s e-commerce growth.
Global Microsoft will also empower SMEs and Startups through digital technologies and enhance digital skills for jobs.
There were further pledges by International Development Finance Corporation to grow businesses and develop the country in infrastructure for entrepreneurship to flourish and funding from World Bank to help mitigate the effects of climate change.
Additionally, Kenya will host the Kauffman Fellow Africa Venture Capital Summit in Kenya Sept 2023, bringing 300 of the worlds best venture capitalists to Nairobi.
The President, while addressing the summit, called on the US to take advantage of Africa’s huge population, the prospects under the African Continental Free Trade Area (AfCFTA) that is in the cusp of take off and availability of affordable labour and green energy potential.
He also used the opportunity to position Kenya as one of the most favorable investment destinations for the abundant US capital, attributing its competitive advantage to a maturing democracy and well-developed financial and commercial ecosystem.
He noted that Kenya has enjoyed political stability over the six decades of its sovereignty.
“We have held elections without fail since independence, and competitive presidential elections since 1992, which have produced three peaceful transitions of power. I am the fourth competitively elected president since the re-introduction of multiparty democracy, and as some of you might remember, I engaged business leaders here in February when I was a candidate,” he told the summit leaders.
According to the President’s Spokesman Hussein Mohamed, the President demonstrated in the US-Africa summit and previous international engagements that he will sell Kenya as an investment destination rather than just a trading partner.
More investment than debt
“This is why thus far, he has been able to secure more investment commitments rather than more debt. This also translates to more jobs for Kenyans and the impact on job creation will be enormous in the years to come,” said Hussein.
“More intercontinental trade meant more job/enterprise opportunities for Kenyans, which is in line with the President’s commitment to create opportunities and jobs for all Kenyans,” added the President’s spokesman.
During the US visit, Hussein said, the President also pushed for support in advancing regional stability and peace, aid global initiatives to counteract violent extremism and cooperate with other countries as a reliable ally.
“Kenya has been at the forefront through EAC in seeking peaceful resolution of the Eastern DRC conflict, and President Ruto has always maintained that while the international community plays its role; the region must be at the forefront in seeking solutions to our problems to realize our potential in trade and people’s well-being,” said Hussein.
The President noted that the distinguishing feature of Kenya was its business competitiveness that had made it the Eastern and central African region’s leading trading nation with a highly educated, skilled and enterprising people making the country the gateway to Eastern Africa and a compelling destination for businesses and non-governmental organisations wishing to set up in the region.
He noted that the Kenyan financial sector is one of the most robust on the continent. Kenya, Ruto noted, has a sound framework to protect investors and their business interests as provided by the constitution of Kenya, 2010, together with the Foreign Investment Act, 1964, supplemented by the Multilateral Investment Guarantee Act and the Convention on the Settlement of Investment disputes.
The pitch
While making his pitch at the Summit Ruto according to multiple sources who spoke with the Standard is said to have identified a number of policies his government had implemented in the three months in office to enhance the business environment including the digitisation of government documents and processes and reduction and harmonisation of procedures.
Other measures Ruto identified were the simplification and clarification of processes, offering of the competitive fiscal and non-fiscal incentives to investors by actors like KRA, Capital Markets Authority, Export Processing Zones Authority and the Special Economic Zones Authority.
The President is said to have told the summit that Kenya was rated highly on investment destinations. The country has been rated 1st globally for five consecutive years with respect to financial inclusion, according to Brookings Institution, also first in the protection of minority investors and second leading innovation hub in Sub-Saharan Africa according to the Global Innovation Index 2019 report.
Ruto also said Kenya was the second most improved mobile industry in Sub Saharan Africa (SSA), fourth
globally in access to credit and microfinance loans according to the World Intellectual Property Organization whic went ahead to demonstrate the country as an investment hub of choice.
In pushing for the US to see Africa as a partner, Ruto noted that it was ironic that the share of Africa’s trade with the US shrank under the African Growth and Opportunit Act (AGOA), yet total trade grew to 60percent.
“When you turn your attention to investments, you will immediately notice a different trend. The continent’s population of 1.4 billion is projected to rise by 300 million people - the size of the entire US population - over the next 8 years this is a huge market for investment,” Ruto told the summit.
He is said to have given an example of the Techno a global mobile manufacturer, which walked its way to be the third biggest in the world by exclusively serving the African market.
Ruto observed: “Similarly, the annual market for motorcycles is 40 million, annually, with Kenya contributing 300,000 per year. A focus on the income level of the market will deny us the opportunity to appreciate the real potential in the African market. The numbers tell a different story.”
The World Bank report on food and agribusiness market potential, according to the President, projected that population growth will increase the demand for food in Africa to more than Sh120 trillions (1 trillion dollars), up from about Sh40trillion (330 million dollars).
“Instead of urging African countries to open up their economies to US food or other commodity trade, US
businesses should work with their competitive advantage - agricultural machinery and know-how,” Ruto said.
He told the summit that owing to Africa’s young and skilled population as well as an endowment of plentiful, clean, green energy, Africa was poised to take over the decarbonisation of manufacturing and become the first continent in history to power its industrialisation using green energy.
“We want to push for a robust mechanism for pricing carbon, because carbon markets will ultimately unlock financing and drive industrial investments in Africa, where abundant, cheap, green energy is found,” he said. BY THE STANDARD MEDIA
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