Good morning.This week we focus on progress in construction of infrastructure projects as well as the renewed impetus in promoting manufacturing and industrialisation.
President Kenyatta to commission Volkswagen production line
President Kenyatta will formally re-open Volkswagen’s (VW) production line in Kenya on Wednesday, at a ceremony in Thika that will also be attended by the German automaker’s CEO Dr Herbert Diess.
The ceremony will see the first Volkswagen car assembled in Kenya in four decades, a VW Polo Vivo, roll out of the production line at the VW facility inside the Kenya Vehicle Assembly (KVA) area.
“I am looking forward to this event. It is evidence that we have put in place the right policies and are promoting the right environment for industry to grow, for business to grow, for industry to grow, for jobs to grow,” President Kenyatta said ahead of the launch.
The Polo Vivo has so far only been produced in South Africa. It therefore makes sense for this model, and Volkswagen South Africa, to lead the expansion into Africa as VW plans to create a new region for the Group in Africa. Part of the strategy is to develop affordable innovative financing packages with local banks that will expand the new market significantly.
While the intention is to start operations on a small scale with the Polo Vivo, the production facility is designed to be flexible to include production of additional models such as the luxury brands, SUV Tiguan and the Passat.
Employees working on the Volkswagen line have been fully trained on the production systems and processes to ensure that the Kenyan VW vehicles will have the same high quality as other VW production plants around the world.
Kenya is one of Africa’s key emerging markets. The country plays a prominent role within Africa and, with a GDP of over US$69.2 billion it is one of the strongest economies in the East African Community and region. Kenya is also an important transit country for trade throughout East Africa.
Pan Paper reopens, Rivatex to follow
Last week, President Kenyatta presided over the reopening of Pan Paper Mills – now renamed Rai Paper – that was shut 11 years ago. The roaring back to life of the paper plant brought with it 500 immediate jobs, with another 500 to follow when the plant is fully rehabilitated.
With a planned investment of KSh 10 billion in the next three years, the plant will employ 2,000 to 2,500 direct jobs, with thousands of other auxiliary jobs expected in the pipeline. Thousands of residents of Webuye Town turned up for the event, a major boost to the town’s economy as well as the rest of Bungoma County.
Next in the pipeline is the reopening of Rivatex in Eldoret, due to resume full operations in the coming months after a cash injection of nearly KSh 3 billion. The Rivatex investment is part of the government’s plan to significantly lift its exports to the U.S, market under the favourable AGOA exports quota.
Kenya is already one of the leading exporters to the US market under the African Growth and Opportunity Act (AGOA).
President Kenyatta to preside over NYS pass out parade
President Kenyatta will on Tuesday preside over the pass out parade of recruits at the National Youth Service, Gilgil, Nakuru County.
When the president officiated at the September 2014 event, he witnessed 4,203 graduands, including 1,158 women and 3,045 men passing out. On Tuesday, he will stand to applaud the remarkable improvement that saw the last recruiting season onboard 2,648 young women and 7,903 young men.
The President will be celebrating the passing out of 10,411 recruits, who have endured the rigours of training to reap the rewards of their collective recognition – which is dedication to the ideals of service.
Expansion of Malindi Airport
In the previous week, the Kenya Airports Authority made marked progress in the expansion of the Malindi Airport. Phase 1 of land acquisition is at its final stages, which entails the acquisition of 25 hectares. The transfer of funds to the National Lands Commission, who will undertake and facilitate the land compensation, has been completed. The second phase will require the purchase of additional land for extension of the main runway. This will pave way for direct flights from Europe.
The ongoing works at Malindi Airport, which include the extension of the Apron, the upgrade of the security perimeter fence and the expansion of the car park to accommodate 51 more vehicles, is 70% complete. Full completion is scheduled for end of January 2017.
Lamu Port is the anchor for the LAPSSET Corridor Program, which contains seven key project components that are geared towards opening up Northern Kenya. It is the entry and exit point of the entire transport Corridor and therefore its realization is vital. The government undertook ground–breaking for the LAPSSET Corridor Program at Lamu Port in March 2012, after which it commenced construction of various preliminary infrastructural facilities and services at Lamu Port.
Substantive progress has been made in this front. Early last week the Board of Kenya Ports Authority and the Board of the LAPSSET Corridor Authority toured the new port area in Lamu where on-going dredging works, piling, concrete blocks pre-casting, formation of cofferdam and land reclamation was witnessed.
Currently 400 local youth are employed at the site, with this number expected to grow to over 1000 in the coming months. Additionally, local companies are increasingly providing supplies and services to the port as works intensify. The first of the three berths will be ready for use in June 2018.
It is expected that the Port will handle 23 million tones per year by 2030.