Kenya is keen to attract more funding from South Korea in renewed bi-lateral ties, as the East Asian nation moves to increase its development assistance budget by 40 per cent.
This is in addition to lending by the country’s institutions led by the Export-Import Bank of Korea (Korea Eximbank), which is seeing to expand its support on trade and investments, mainly Korean companies doing business with Africa.
Speaking on Thursday at the 2023 High-Level Conference on Korea-Africa Partnership, in Nairobi, Korea’s National Assembly Speaker Kim Jin-pyo said the ODA will be channeled to projects specifically tailored for individual country’s needs.
The planned increase will now take Korea’s ODA to about $5.3 billion (Sh788.1 billion) next year, from the current $3.8 billion (Sh565.1 billion).
“Korea is more than ready to open doors to a new era of development,” Kim Jin-pyo said, noting key areas of focus will include food security and health.
In November last year, South Korea agreed to support Kenya’s development agenda by committing Sh120 billion to various projects including agriculture, ICT, health, energy, infrastructure, education, affordable housing and urban transport.
It is also working with the government to develop manufacturing plants at the Konza Technopolis, an export promotion zone dedicated to pharmaceutical manufacturing, vaccine production, and value addition in agriculture.
President William Ruto recently urged the South Korean Parliament to pass legislation that will ease trade between the two countries and secure job opportunities for Kenyans.
Uasin Gishu woman representative and Kenya National Assembly Deputy Speaker Gladys Boss has since echoed Ruto’s sentiments, calling for laws that will further drive the existing trade, economic development and transfer of skills relations.
Opportunities for Korean investors she said, include textile, ICT, manufacturing, and value addition of agricultural products.
“We welcome development financing from the Korean government and also welcome investors,” she said.
South Korea is backing the African Continental Free Trade Area which is considered the world’s largest free trade area.
Kenya is among the six countries piloting the AfCFTA, alongside Ghana, Cameroon, Egypt, Rwanda and Tanzania.
Kenya and South Korea have enjoyed strong bilateral ties over the years, including in trade, despite volumes being in favour of the latter.
According to the Kenya Economic Survey 2023, the value of imports from South Korea increased from Sh22.3 billion in 2021 to Sh50.2 billion in 2022, mainly due to increased imports of kerosene-type jet fuel.
Exports equally increased to Sh6.1 billion, from Sh3.9 billion.
Kenya’s main exports include coffee, titanium ore and scrap copper.
Kenya imports include iron and steel, organic chemicals, machinery, nuclear reactors, boilers, and manmade staple fibers, among others.
In February this year, the two countries pledged to continue to nurture and expand ties aimed at contributing to socio-economic development.
The Korea Eximbank (The Export-Import Banko of Korea) has an MoU with the Afreximbank (African Export-Import Bank), which recently saw a $100 million (Sh14.9 billion) credit line unveiled.
This is to support Korean companies in expanding their business to Africa, with Kenya among the target countries.