Kenya receives US$430m in agriculture investment pledges from China

Kenya has received US$430m in agriculture investment pledges from two Chinese companies during President William Ruto’s recent state visit to Beijing. In a joint statement following Ruto’s meeting with President Xi Jinping, China also committed support for investment in Kenya’s agriculture and agri-processing sectors.

Shandong Jialejia Agriculture and Animal Husbandry, a first-time investor in Kenya, plans to set up a poultry operation on a 40-hectare site south of Nairobi. The US$30m project will include a layer farm with 500,000 birds for egg production, a breeding facility housing over 10,000 parent stock, and an animal feed mill.

The second agriculture deal came from Zonken Group, which committed US$400m to expand its operations in Baringo County, western Kenya. The company, which has previously made investments in aloe cultivation in the region, has acquired 121 hectares for large-scale aloe farming and processing. It also intends to develop a 29-hectare vineyard for grape seedling production and invest in apple seedling cultivation.

During the visit, the Kenya Investment Authority also held talks with Anhui Guangxin Agrochemical, a Shanghai-listed firm planning to invest US$300m in an agrochemical industrial park. A company delegation is expected to visit Kenya to scout for a suitable location.

The joint statement said China would import more Kenyan products and work to promote more balanced bilateral trade. Ruto advocated for preferential access to the Chinese market for Kenyan tea, coffee and macadamia nuts, which still face tariffs. China has become a major importer of Kenyan macadamia in recent years, with the East African country ranking as the world’s third-largest producer after South Africa and Australia. Kenya is hoping to replicate the success of its avocado industry, which gained market access to China in 2022 under Beijing’s “green lanes” initiative for African agricultural products.

Beyond agriculture, Kenya secured additional investment pledges worth US$343m from five other Chinese companies, covering sectors including manufacturing and hospitality.

Infrastructure projects featured prominently in the discussions. China pledged to support the long-delayed extension of Kenya’s Standard Gauge Railway to the Ugandan border – a project that stalled in 2019 after Kenya failed to secure further financing. The railway’s initial phases, running from the port city of Mombasa to Naivasha via Nairobi, were built at a cost of around US$5bn, largely funded by Chinese loans. The line has struggled to operate at full capacity, with critics noting that its current terminus in Naivasha remains poorly connected to key regional trade corridors. Beijing also committed to support the expansion of the highway linking Nairobi to Nakuru, a major Rift Valley city, through a public-private partnership model.

China is Kenya’s largest bilateral lender, having financed a series of large-scale infrastructure projects over the past decade. However, Kenya faces mounting debt and high repayment costs. Ruto, who took office in 2022, has pledged to avoid default, vowing to cut waste and boost domestic revenue.

The two governments also agreed to deepen cooperation in healthcare, with Chinese firms expected to support the development of Kenya’s medical industries. Plans to launch direct flights between Beijing and Nairobi are also being explored.

 

References

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