Turkish firm bets Sh90b in manufacturing deal
By Herald Aloo, July 28, 2022
Turkish investors have signed a $760 million (Sh90 billion) deal to set up an industrial plant in Naivasha mainly targeting foreign markets as Kenya seeks to bridge its widening trade deficit.
The investment by Turkish Industry Holdings will export 70 per cent of the manufactured goods to United States and European countries while the remaining 30 perc ent will go to the local markets.
This will see the company utilise the current duty-free trade agreement under the African Growth and Opportunity Act (Agoa) between Nairobi and Washington, which expires in 2025.
“Our investment partner has been researching the country for the last one year. After a long research of the country’s (Kenya) investment infrastructure, we are able to launch our very first day for our breaking ground ceremony,” said Mehmet Coskun, president of Turkish Industry Holding A.S.
Construction of the plant will be completed within 30 months, targeting six production lines, mainly fiberboards, ceramics and steels. Other products such as sanitary pads, aluminum profile and tissues papers will also be manufactured for the external market.
The move will create about 2900 employment opportunities and inject roughly $560 million (Sh66.1 billion) into Kenya’s economy annually. Once rolled out, the company estimates it will earn Kenya an annual revenue of $360 million (Sh42.5 billion), which it says reflects 5 percent of the total current exports from Kenya.
The deal is part of the Special Economic Zone signed by the president on Tuesday 26th in Naivasha and is touted as an economic gamechanger for the region. A dip in Kenya’s exports triggered a surge in import bill as it trais even peers in the East African Community in terms of exports.