Chinese firm to develop steel plant in Kenya

The Kenyan government said on Friday it has signed an agreement with a Chinese firm, Sinosteel, to develop a steel plant in the East Africa nation.

Cabinet Secretary for Industrialization and Enterprise Development Adan Mohamed said Kenya had a demand of about 1.8 million metric tonnes of steel annually as at the end of 2013. This demand, he said in a statement issued in Nairobi, is forecast to grow to 2.5 million metric tonnes by 2020 and be doubled by 2030.

"The on-going real estate boom, standard gauge railway project construction, Lappset corridor and the 10,000km new road network project provides an excellent off-take for steel and steel products," he said.

The regional demand amplifies this further with expected investment in regional infrastructure projects running into billions of dollars in the next 3 to 5 years, he said.

Mohamed expressed confidence that Sinosteel's experience in the steel sector will yield the desired outcome for the projects. He said investment in a steel plant in Kenya will significantly improve trade balance and foreign reserve position given the significant consumption of resources in import of steel products.

Sinosteel's Managing Director Wang Jian noted that increasing regional demand for steel products in light of the growing infrastructure and real estate development is making it appropriate timing for Kenya in prioritizing the steel mill project. Endi