- Japan’s Toyota Tsusho Corporation will invest $5 million (KES800 million) in the Kenya Thika Vehicle Manufacturing initiative.
- A total of $93.7 million (KES 15 billion) will go towards the Meru Wind Farm Energy project, while $49.9 million (KES8 billion) will be invested in the Isiolo Solar Energy initiative.
- Japan is also readying $468.5 million (KES75 billion) for Kenya’s Menengai Geothermal Plant, as the Asian country promotes clean energy solutions.
In a move poised to reshape Kenya’s industrial landscape, Kenya and Japan have jointly announced plans to invest an estimated $617.2 million in East Africa’s largest economy, with a focus on bolstering key sectors of vehicle manufacturing and renewable energy.
This investment initiative marks a pivotal moment in the bilateral relations between Kenya and Japan, promising to unlock new opportunities for economic growth, employment for the youth, and sustainable development.
The cornerstone of this investment endeavor was laid this week with the signing of a framework agreement between Kenya and Toyota Tsusho Corporation of Japan. This landmark agreement signifies a commitment to collaboration in vehicle manufacturing and renewable energy development, heralding a new era of partnership between Kenya and Japan.
Toyota to set up vehicle manufacturing plant in Kenya
A key element of the agreement entails the establishment of a state-of-the-art vehicle manufacturing plant in Kenya by Toyota Tsusho Corporation, a move set to revolutionize the automotive industry in East Africa’s largest economy.
With an initial investment of $5 million (KES800 million) earmarked for the Kenya Thika Vehicle Manufacturing project, Toyota’s entry into the Kenyan market holds the promise of enhancing industrial capacity and fostering economic resilience.
With a vehicle manufacturing factory, Kenya is set to join the league of Ghana and the continent’s most advanced economy South Africa in hosting a Toyota Tsusho Corporation car plant.
President William Ruto, who is visiting the island country in East Asia, lauded this strategic partnership, emphasizing that it holds a transformative potential for Kenya’s industrial sector.
Dr Ruto underscored the importance of locally manufactured vehicles in ensuring affordability and reducing the reliance on imported used cars, thereby promoting sustainability and bolstering the growth of Kenya’s domestic automotive market.
The signing ceremony, held in Tokyo, witnessed the participation of President Ruto and Toyota Tsusho Corporation President Ichiro Kashitani, reaffirming the commitment of both parties to realizing the shared vision of economic prosperity and technological advancement between Kenya and Japan.
Toyota Tsusho Corporation to pump billions in Kenya’s solar and geothermal projects
In addition to vehicle manufacturing, the agreement features a significant investment in renewable energy infrastructure, highlighting Japan’s commitment to advancing sustainable development goals in Kenya.
With allocations totaling $93.7 million (KES 15 billion) for the Meru Wind Farm Energy project, $49.9 million (KES8 billion) for the Isiolo Solar Energy initiative, and a substantial $468.5 million (KES75 billion) earmarked for the Menengai Geothermal Plant, Japan’s investment portfolio underscores its dedication to promoting clean energy solutions and mitigating environmental impact.
Moreover, the agreement underscores the promotion of electrified vehicles, including hydrogen electric vehicles and hybrid vehicles, highlighting Japan’s commitment to innovation and technological advancement in Kenya’s transportation sector.
Japan’s $617.2 million worth of investment pledge represents a transformative milestone in Kenya’s economic trajectory, with far-reaching implications for industrial growth, job creation, and sustainable development.
As Kenya and Japan forge ahead with their collaborative efforts, fueled by a shared commitment to innovation and progress, the stage is set for a dynamic partnership that promises to shape the future of both nations for generations to come.
Kenya and Japan trade relations: 1995-2021
Kenya and Japan share a longstanding and robust trade relationship that has evolved over several decades. According to the Observatory of Economic Complexity (OEC), an online platform dedicated to tracking global economic activities, the trade ties between these two nations have remained well-established and dynamic.
In 2021 alone, Japan exported goods valued at $991 million to Kenya, with key products including cars, hot-rolled iron, and delivery trucks.
Conversely, Kenya’s exports to Japan have also seen notable growth over the years, reaching $87.8 million in 2021. The primary exports from Kenya to Japan include titanium ore, other ores, and coffee beans.
The consistent increase in Kenya’s exports to Japan, growing at an annualized rate of 5.32 percent from 1995 to 2021, signifies a positive trajectory in bilateral trade relations and underscores Kenya’s role as a reliable trading partner for Japan.
The upward trend in trade volumes between Kenya and Japan, coupled with the diversification of traded goods, reflects the mutual benefits derived from their economic partnership.
Understanding Toyota Tsusho Corporation of Japan
Headquartered in Nagoya, Aichi, Japan, Toyota Tsusho Corporation engages in the trade of essential commodities such as steel, aluminum, electronics, and energy, alongside providing machinery and consumer products and services.
Its portfolio extends to include chemicals, textiles, and logistics services, catering to a diverse clientele that spans machine manufacturers, textile industries, semiconductor companies, and players in the chemical, beverage, food, and agriculture sectors.
Operating through a vast network of subsidiaries, affiliates, and offices, Toyota Tsusho maintains a formidable presence across key regions including Asia-Pacific, the Middle East and Africa, Europe, and the Americas.