Kenya, UAE ink Sh67 billion mining, technology deals

Kenya and the United Arab Emirates have teamed up to enhance investments in the mining and technology sectors, marking a strategic move by the Emirates to broaden its global investment portfolio.

On Wednesday, Kenyan President William Ruto held a meeting with United Arab Emirates Minister for Investment Mohamed Alsuwaidi at State House Nairobi.

"Kenya and the United Arab Emirates have agreed on a financing and investment framework through which our two countries will explore programmes and investment opportunities worth $500 million (Sh67 billion)," posted Ruto on the X platform.

The Ministry of Investment in the UAE and the Ministry of Treasury and Planning in Kenya also inked an investment memorandum, heralding a new era of collaboration in the mining and technology sectors.

The UAE investment minister is also the chief executive of one of Abu Dhabi's biggest sovereign funds, ADQ, which announced the financing and investment agreement with the Kenyan Ministry, earmarking $500 million for investments in key sectors of the Kenyan economy.

Growth potential

Kenya's mining sector holds immense growth potential, boasting strategic reserves of gold, copper, aluminium, tantalum, and other minerals.

The sector's advancement promises to bolster Kenya's economy by creating jobs, enhancing livelihoods, and positioning Kenya as a leader in African mining.

Often referred to as Silicon Savannah, Kenya stands as the largest economy in East Africa, contributing over 40 per cent of the region's GDP.

The investment memorandum prioritises mineral exploration, mine development, mineral processing, refining, and marketing in Kenya.

The UAE team led by their Minister for Investment Mohamed Alsuwaidi (right) at State House, Nairobi on April 24, 2024. (Photo: PCS)

The key objective is to explore opportunities for technology transfer in the mineral sector, fostering innovation and growth.

Both countries are committed to promoting responsible management of the minerals sector while emphasising environmental, social, and governance practices.

Additionally, collaboration in research and development across specific sectors is also on the agenda.

"This MOU marks a pivotal moment in UAE-Kenya economic cooperation. We envision a future where sustainable mining practices, innovation, and responsible oversight drive our mutual growth. Through technology, we aim to enhance capabilities and establish robust governance practices, ensuring prosperity for both nations," UAE's Minister of Investment Mohammed Hassan Al Suwaidi said.

Bilateral investment cooperation

The signing of the investment memorandum and agreement follows last month's bilateral investment cooperation announcement aimed at fortifying the digital infrastructure sector in Kenya.

The UAE is a federation of seven emirates, dominated by the capital Abu Dhabi and regional trade and tourism hub Dubai, with each having its own individual investment strategies.

Economic competition in the Gulf is growing as states try to diversify income sources and increase non-oil growth.

The UAE is among the most advanced in that effort, with the non-oil sector accounting for more than 70 per cent of its GDP.

Trade and logistics, financial services, manufacturing and tourism are its key economic sectors.

Over the past decade, the UAE has emerged as one of the largest investors in Africa among the Cooperation Council for the Arab States of the Gulf (GCC) and is the fourth-largest investor globally in Africa after China, Europe and the United States.

According to a real estate consultancy Knight Frank, in 2018 alone, the Abu Dhabi Fund for Development financed more than 66 projects in 28 African countries, valued at $16.6 billion (Sh2.19 trillion).

Between January 2016 and July 2021, the UAE invested $1.2 billion (Sh158.9 trillion) into sub-Saharan Africa, a staggering 88 per cent of the GCC total.

Neighbouring Saudi Arabia, the region's biggest economy, is also forging ahead with a transformation plan known as Vision 2030 that is overseen by Crown Prince Mohammed bin Salman.