The newly opened standard gauge railway, linking the port city of Mombasa and the capital city Nairobi, strengthens Kenya’s position as the regional infrastructure hub.
The railway makes Kenya a desirable entry point into East and Central Africa, thus marking the start of a new era for the region’s industrialisation and economic development.
It is a pivotal part of China’s Belt and Road Initiative, which envisions a large high-speed railway infrastructure connectivity plan to eventually link Kenya, Uganda, Rwanda, Burundi and South Sudan and open up the East African region to the Indian Ocean countries.
The SGR is thus strategically poised to bring in foreign investments along the route and meet Kenya’s Vision 2030 quest to be East Africa’s industrial, manufacturing, trading and tourism hub.
To this end, Kenya has in plan three special economic zones – Dongo Kundu in Mombasa, which includes a free trade zone and industrial zone; Naivasha SEZ, which will tap into the relatively cheap geothermal power and will mainly consist of industrial zones and the 500sq km Lamu Port South Sudan Ethiopia Transport Corridor SEZ.
The aim of these SEZs is to grow industrial production and promote Made in Kenya exports.
The ongoing Lapsset Corridor development in addition has the following components; Lamu Port, a product oil pipeline from Lamu-Isiolo-Moyale (Kenya) and Moyale to Addis Ababa (Ethiopia) and resort city investments in the proposed Lamu Resort City, Isiolo Resort City and Turkana Resort City.
Once complete, the corridor will at regional level provide seamless connectivity and enhance trade and logistics by providing an alternative and strategic corridor to serve the landlocked neighbouring countries of Ethiopia and South Sudan.
At the continental level, the Lapsset Corridor will complete the Belt and Road Initiative’s missing link between Lamu Port on the Eastern Africa coast of the Indian Ocean to Douala Port (Cameroon) in the Western Africa Atlantic Ocean.
The grand plan will thus strengthen cross-continental and intercontinental trade and logistics between the East and the African continent.
With the infrastructural developments in high gear, it is an opportune time for Kenya to start upscaling its manufacturing processes.
Kenya should begin building the knowledge and skills gaps that will drive the desired industrialisation.
Above all, the country should identify and clearly drive the value chains that will grow Made in Kenya brands for export in Africa, the Indian Ocean countries and the rest of the world.
This will decrease Kenya’s over-reliance on low value-added exports into the US though the now shaky AGOA arrangement and into the EU.
The author is a markets entry consultant with Growth Concepts International Ltd