Deputy President William Ruto on Friday broke the ground for construction of the country’s first special economic zone (SEZ), saying it was part of the fulfillment of their manifesto.
Africa Economic Zone (AEZ) Pearl River is the first privately owned SEZ that when complete is expected to create jobs and wealth for Kenya. The project is estimated to cost Sh200 billion in infrastructural development.
Sitting on a 700-acre land in the Plateau area, Uasin Gishu County, the project will unleash 40,000 direct and 150,000 indirect jobs when complete. President Uhuru Kenyatta, in a speech read by his deputy Ruto, described it as “a milestone in industrialisation”. President Kenyatta said industrial zones will transform the way Kenyans do business, the same way they have done in other countries.
He said the industrial park will bring manufacturers, especially those in agro-processing, closer to raw materials, create a wider labour pool and easy access to the regional market such as the East African Community (EAC), COMESA, European Union and the United States.
Party promises
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Speakers hailed the project as realisation of Jubilee’s promise as contained in their 2013 manifesto in which they promised to drive the industrialisation process in the country by creating special economic zones.
“It was in 2014 that Jubilee formulated the Special Economic Zones Act – a law that will lay the framework for the development of areas outside Nairobi with tax incentives to companies that set up in the zones,” said Ruto, noting that the location of the project outside Nairobi was the beginning of divesting from the country’s capital city. Zhu Layi, the Chairman of Guangdong New South Group Limited, the Chinese company that has partnered with Africa Economic Zone Limited to launch the project, said the management will ensure enterprises in the zone hire locals.
“As management we will require the enterprises to hire at least 80 per cent from the locals,” said Mr Zhu.
The project is expected to be finished in three years, with all the necessary infrastructure, including power lines, roads, water having been put in place. Enterprises, both local and international, will then be expected to take up space in the park.
Although SEZs have been the panacea for a number of country’s economic growth, including China and Malaysia, the ones in Kenya have slowed to pick up, and those that have been launched have started on a wrong footing.
Konza City, a Government-owned ICT park, has picked up slowly, and remains vastly a grassland since 2012 when former President Mwai Kibaki broke the ground.
Tatu City, another SEZ, has been stained by numerous wrangles, placing it on the danger of collapse.
Chinese interests
The Jubilee Government has put its hope on the industrial parks to develop necessary capacity that can then be used on the recently completed standard gauge railway from Mombasa to Nairobi.
Other industries expected to operate in the zone, besides agro-processing, are energy and machinery, engineering, electronics, chemicals and phamarceutical industries.
“The AEZ Pearl River brings the manufacturers closer to raw sources, educated labour pool and access to the markets of AEC, COMESA as well as EU and the USA,” said AEZ Chairman Dr David Langat.
Some 18 Chinese companies have expressed interest in the project. The groundbreaking attracted a contingent of 40 businessmen from China.
Guangdong has the experience in running special economic zones, with one in China and another Nigeria.
Construction of the industrial park constitutes the first of the projects that will lead to the construction of a science and technology park in the second phase and Olympia City, which will be home to hotels, residential, shopping malls, recreation area and hospitals.
Once complete, the total production output from the project is expected to hit Sh300 billion annually, which is about five per cent of the current gross domestic product (GDP), or the total value of products produced in the country.
