China’s march in Kenya upsets local firms

• Contractors say the Chinese get big easy deals and could drive them out of business

Days after a visit by the Chinese Foreign minister Yang Jiechi, the Moi International Sports Centre, Kasarani in Nairobi was closed down for a Sh1 billion renovation.

Shengli Engineering, a Chinese firm, was awarded the lucrative tender to refurbish the country’s biggest stadium that was built by the Chinese government for the All Africa Games in 1987.

It also transpired that the Chinese official had confirmed his country’s support for plans to build a multi-billion dollar sea port in Lamu.

Once constructed, the port would serve as a key entry into southern Sudan, Ethiopia and Rwanda via a new rail network.

While the government is receiving the windfall from the China, many local companies are questioning the easy way in which Chinese firms seem to access major capital projects and key sectors of the Kenyan economy.

Major projects

Cheap and often sub-standard Chinese goods have also found their way onto the shelves of Kenyan supermarkets and kiosks.

From 44 companies in 2001, the presence of Chinese firms has increased to more than 200 operating as trading companies, restaurants and clinics.

The Cninese Embassy in Nairobi says there are 12 major Chinese companies in Kenya, including Huawei Telecommunications, Sinohydro Corporation, China Road and Bridge and Shengli Engineering.

Also in the country is China National Offshore Oil Corporation (CNOOC), which is involved in the exploration for oil in northern Kenya.

Chinese companies are already involved in various other sectors in Kenya, including telecommunications, infrastructure and energy.

The projects in different parts of the country run into billions of shillings.

The construction sector – housing and roads – has attracted the highest number of Chinese companies with key roads in the country under rehabilitation or construction by them.

Among the major projects undertaken by the Chinese firms are the expansion of the Kisumu airport, rehabilitation of the Moi International Sports Centre, expansion of Thika-Nairobi highway, the Sondu Miriu power plant interface and oil exploration in northern Kenya.

The acting permanent secretary in the ministry of Roads, Hyslop Ipu, defended the award of tenders to Chinese firms saying most of the tender had been floated internationally while others had restricted conditions for the bidders.

But local traders and firms involved in construction are questioning the rationale of shifting towards China when the balance of trade is tilted towards the Chinese.

While none of the local companies is questioning the quality of the Chinese projects, they are concerned that many of them may be forced to close down or lay off staff due to unfair competition.

Roads minister Franklin Bett is on record as praising the Chinese firms for their quality and timely completion of projects.