Will KENYA fall into CHINA’S “DEBT TRAP”? – KJ VIDS
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Will KENYA fall into CHINA’S “DEBT TRAP”? – KJ VIDS

August 14, 2019


– [Kasim] Kenya is among
the African nations that China has had a growing influence in since the turn of the millennium. China has spent billions
of dollars in Africa over the past few decades. Majority of its investments in Kenya go to infrastructure development, much like what China has been
doing in the rest of Africa, as part of its Belt and Road Initiative, an estimated one trillion
dollar plan to connect the country to trade
routes all over the world. I’m your host Kasim and thanks for joining
me for another KJ Vid. In this video we will discuss
China’s interests in Kenya. Just before we start, please
kindly open your browser kjvids.co.uk and subscribe
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access to our content. Your support will help KJ Vids remain politically and
financially independent. We have also left a unique
link in the description which will give you a 50% discount. China-Kenya relations date back to 1963 when Kenya gained independence
from British colonial rule. The alliance between the
two nations started gaining momentum in the past couple of decades as China boosted investments
aimed at infrastructure development in developing
countries around the globe. It was the election of Mwai
Kibaki as President of Kenya in 2002 that paved the way for a new era of Chinese investments in the country. The global development
strategy officially adopted as the Belt and Road Initiative was initiated in 2013. The Belt and Road Initiative
currently involves more than 125 countries
spanning Asia, Europe, Africa, the Middle East, and the Americas that have signed collaboration agreements according to official data from China. China is flexing its
economic muscles in Africa, not because it wants to
colonise Africa per se, but because of mercantilist ambitions in search for raw materials
such as petroleum, timber, cobalt, platinum, copper,
diamonds and so on. There has been a growing
dominance of Chinese influence on the economic front of Kenya. China has penetrated the
Small and Medium Enterprise market in Kenya, causing a
lot of controversies in Kenya. Chinese foreign direct
investments have been on the up in Nairobi, opening up the Kenyan economy to a range of consumer
and industrial goods from the second largest economy while enjoying technical
and financial assistance. There has been growing pressure
on Kenya in recent years to make a shift from a
consumer driven economy to an export driven economy. It currently imports double
the amount it exports to the rest of the world. Kenya introduced a procurement
bill in 2018; made to address the concern of the local
traders and the general public. The bill replaces the
old rule which needed 51% of ownership of an entity
to be considered Kenyan. The new law would require 100% ownership by Kenyans to ensure ownership. Local traders find it
increasingly difficult to compete with Chinese counterparts. Because China has a policy,
to give loans at only 3% interest rates, which they
do to many African nations. According to 2018 figures, over
400 Chinese owned companies were operating in Kenya,
creating thousands of jobs for the local community. Since 2015 China has provided Kenya with 67,000 training opportunities. Chinese Ambassador to Kenya Wu Peng stated earlier this year that
huge infrastructural projects like the standard gauge railway
connecting key port city of Mombasa to Nairobi may
take long to yield returns, though the value will
grow in time, he stressed. The standard gauge
railway, according to Wu, is a flagship project that
showcases the fast speed and high quality of
China-Kenyan cooperation. The construction of the SGR project has driven economic
growth of Kenya by 1.5% and created 46,000 jobs
for local residents. Wu also said the train shortened
the Nairobi-Mombasa trip from over 10 hours to five hours. Since its launch in May 2017,
with an average booking rate of 99%, over 2.7 million
passengers have travelled by the SGR, and around 4.2
million tonnes of goods have been transported, said Wu. Apart from foreign direct investments, the Chinese ambassador claimed that China had made non-financial
direct investment in Kenya worth around $520 million in 2018. He also said that currently
there are over 2,400 Kenyan students studying in China. And in 2018, over 81,000 Chinese tourists travelled to Kenya for
leisure and adventure. In the first quarter of
2019 Kenya signed deals worth $2.23 billion with
China to build a tech city and to build an expressway in Kenya. The Konza Data Centre
and Smart Cities deal is worth $1.72 billion
while the JKIA-James Gichuru expressway project is worth
half a million US dollars. Between 2006 and 2017, China has loaned $132
billion to African countries. Many believe the these
investments are a debt trap and that most African
nations will not be able to pay these debts back. China has always denied being involved with any kind of debt trap policy. Kenya ranks as Africa’s
third most indebted country to China for the period
between 2000 to 2017, according to data from the China
Africa Research Initiative. The country’s current debt
to China is understood to be about $9.8 billion,
which has funded large chunks of national infrastructure,
including a number of highways and the Standard Gauge Railway
which provides a high-speed connection between Mombasa
and Nairobi, the country’s capital, to facilitate the
import and export of goods. In 2018 reports started to
emerge stating that Kenya is fast getting caught in
China’s debt trap diplomacy, as a result of which
China is preparing itself to seize major assets, the
most significant of which is the port of Mombasa. Despite there being no
authenticity in these reports, some media reports claim
that Kenya’s Auditor General had stated it may only be a matter of time until the port is taken over by China because it is seeming increasingly likely that Kenya will fail to pay
off their debts on time. The Belt and Road Initiative
presents standard risks with regards to major
infrastructure projects: debt risks, risks of
corruption and procurement and government, stranded
infrastructure, environmental risks and social risks, all of these primarily in the developing world context. In recent years Kenyan media
have been drawing analogies with the Sri Lanka’s debt situation, with experts warning the country about the possible
consequences of Chinese loans. There are no formal defence
specific agreements, however Kenya has been
increasingly buying Chinese arms for two reasons, firstly they
are cheaper than Western arms, and secondly because of the flourishing bilateral trade relations. According to some of the
recent available information, Kenya purchased arms worth approximately $76 billion in 2015. According to Stockholm
Peace Research Institute, the purchase included
tanks, armoured vehicles and spare parts. SIPRI figures also reveal that East Africa has increased its military
spending over the years with Kenya leading the race. China have expanded investments
in Kenya since 2002, and the two nations have
since seen increasing levels of trade and cooperation and currently China is Kenya’s largest trading partner. If the Belt and Road
Initiative is to be completed, transport projects could
reduce travel times along economic corridors
by 12%, increase trade between 2.7% and a 9.7% income increase lifting 7.6 million people
from extreme poverty, and Kenya would be among the
significant beneficiaries. However, there’s still a long way to go. The ever improving bilateral
relations and increased trade and cooperation between the two nations could potentially be a
win-win for both parties, however there are many
sceptics who would disagree, pointing the finger at
China as the sole winner. Only time will tell what
will eventually happen, and what China’s real motivations are. That’s all for today guys, thanks for watching another KJ Vid. We would love to hear your
thoughts in the comments below especially if you are from Kenya. Please don’t forget to subscribe
to our website kjvids.co.uk for unlimited access to our content. We have left a 50% discount
link in the description below. Thanks for watching again
and see you next time.

38 Comments

  • Reply kashan baloch August 7, 2019 at 1:08 pm

    DEBT TRAP

    IS PROPAGANDA AGAINST CHINA

    BECAUSE WEST KNOWS THAT CHINA IS DANGER FOR ZIONISM

    THANKS ME AFTER WW3

  • Reply Atiq Rehman August 7, 2019 at 1:13 pm

    If china denied debt trap policy than why she is chosing mostly impoverished state. Interstingly, she also solding her military equipment .

  • Reply hamza mehmood August 7, 2019 at 1:20 pm

    China investment = Debt trap
    IMF , World bank = prosperity

  • Reply KJ Vids August 7, 2019 at 2:14 pm

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  • Reply Samuel kirk August 7, 2019 at 2:51 pm

    75 billion aems purchase only for tanks & amour cars that seems off number , maybe 75 million

  • Reply Joe Mosely August 7, 2019 at 3:17 pm

    I Dont See The Problem.

    The USA Has Ignored Africa for Decades, seeing Africa As High-Risk & Corrupt, Not to Mention the Racial Aspect.

    If China is Willing & Able, I Dont See The Problem.

  • Reply Kayonga Arnauld August 7, 2019 at 3:45 pm

    8:00 it's impossible that Kenya buys ammunition that is equivalent to their national gross GDP…..bogus news!!!!!!!!!!!!!!!!!1

  • Reply Mike Larry August 7, 2019 at 4:28 pm

    I heard a concerned chief of some raided village got round house kicked in the face after some altercation with a Chinese man on the grounds of trespassing a Chinese factory. Must of been a rude awakening.

  • Reply Frothy Walrus August 7, 2019 at 4:51 pm

    Just look at all the other countries China has loaned money & how much they owe. They’re such great places known for their freedom and prosperity like Venezuela, Pakistan, North Korea, Iran, and Russia. Pinnacles of liberty.

  • Reply Ali Bumaye August 7, 2019 at 4:59 pm

    Kenya is trying to steal Somali waters and give it to their daddy China to wipe the debt off. That's not happening.

  • Reply Eric August 7, 2019 at 5:36 pm

    KJ Vids, can you talk about Africa's religious influence on China?
    Reference to the China in Africa Project's episode in which they interview the author of this article and discuss this article: https://unherd.com/2019/02/how-africa-is-converting-china/

  • Reply NO. islam phobia Mamou August 7, 2019 at 5:44 pm

    Ofcourse ……. Uhuru leaving all That Debt next generation…. U better wake Up Kenya…..

  • Reply james machau August 7, 2019 at 6:01 pm

    Sadly your research here is wanting. This does not look like your best work. Sad because Kenya is the only node of the BRI in SSA. And one of the 4 node countries also targeted for investment by USA in its Africa plan. This is a big deal.

  • Reply Angry Mob of Midgets idk August 7, 2019 at 6:35 pm

    Pakistan is next .

  • Reply The Hunter x Hunter 2011 Dickriding Association August 7, 2019 at 6:55 pm

    China: raises millions out of poverty
    The West: autistic screaming
    Also appreciate y'alls nuance tho

  • Reply Jeff Kirau August 7, 2019 at 7:33 pm

    Kenya purchased arms worth 76 billion US dollars 8:04 with a yearly budget half that? Or maybe I misunderstood.

  • Reply fast track August 8, 2019 at 12:29 am

    sorry but Kenya's military spending is not in the billions it's in the millions false info

  • Reply Muhammad Khaidir Naufal August 8, 2019 at 3:39 am

    Beware of China they are the toughest nation in the world in the era

  • Reply Bagpuss Bagpuss August 8, 2019 at 7:03 am

    I'm very unhappy with the biased and partial account given in this video. Some historical comparison would be useful: the IMF and World Bank have been operating in the same way to influence debtor nations for many decades, to the benefit of the USA. Rather than be underutilised, it is natural for China to use its massive manufacturing capacity and expertise outside its borders, the Chinese mindset is that global economic development is necessary for continued Chinese economic development and this non-zero sum attitude is far healthier for the global economy than the current American mercantilist view.

  • Reply Bagpuss Bagpuss August 8, 2019 at 7:10 am

    The first obviously biased video I think I've seen on this channel. Deliberately bereft of historical context and comparative analysis in order to demonise China. The same old anti-Chinese talking points seen everywhere nowadays. Shame.

  • Reply MohammedFarhan Khan August 8, 2019 at 10:40 am

    Change the background audio bro, otherwise, your content is amazing! 👌😊😎

  • Reply Walter Davies August 8, 2019 at 10:48 am

    The Marshal Plan helped rebuild Western Europe . The belt and road will rebuild Africa, including Kenya. China is not naive to invest it's funds where they will get lost. Chinese investments are largely in manufacturing industries and not exploitive sectors like mining (Where the West majors). A sign they are here for the long-term. The only way China can practically threaten the US hegemony is by having its own independent sphere of influence. Just as the US has the assurance of the West to support its agendas

  • Reply Alan Foo August 8, 2019 at 10:49 am

    I suggest you stop doing video because in the first place there is not such thing as death trap for loans.

    What death? Has any country so far gone into death mode? Not even Sri Lanka which actually benefited greatly from chinese money as they create jobs n the area they developed . When they could not pay when the project was not generating enough China took over the risk of taking 99 years lease just lime any landowner .

    Sri langka still own the Port which now gets lots of taxes and jobs instead of a village that govt get only a few fish..

    Stop mimick jealous attempt to stop China from helping the world when they themselves never did or want to do.

    Now the countries able to enjoy development .

  • Reply rick ross August 8, 2019 at 11:52 am

    I don’t see the problem with benefiting Africa. The Chinese seek money to keep their economy growing, they don’t seek to blow up children like the USA

  • Reply Roger Klang August 8, 2019 at 5:55 pm

    Except for my own podcast World Policies at Anchor, this is the number one media channel about strategy.

    I can tell you what China wants. But first I will tell you that the situation in Tanzania to the South of Kenya which is a country that also borders to Uganda just as do Kenya, have just as many Chinese Citizens as there are African Citizens. I know this for a fact since I recently spoke with a fellow Swede who had been living in Kenya for the last 20 years. You may ponder upon this for a moment.

    I bet it won't come as a surprise if I mention oil here. In and around Victoria lake there are rich oil fields. And when I say rich I mean REALLY rich! Prospects from 2008 suggests it. It takes 15 years at least to develope an oil industry and build ports, ports that will have to be built in Kenya and/or Tanzania. 11 years have passed. End of story!

  • Reply Samuel Appiah August 8, 2019 at 10:25 pm

    Europe has absolutely no space to complain.
    They controlled the continent for a whole century and didn’t contribute to half of this development….

  • Reply kcelestinomaria August 8, 2019 at 11:38 pm

    Konza city is not being built by the Chinese,it's being built by South Korea and the Kenya government is paying…this is FAKE NEWS!!!Kenya is not the third most indebted to Kenya…FAKE NEWS..stop lying!!!

  • Reply Hyetts August 9, 2019 at 2:49 am

    After what China did in Sri Lanka, Djibouti and Zambia, it should be obvious that China’s interests are not any different in Kenya, especially considering Kenya’s geopolitically strategic position, with East Africa’s largest port (Mombasa), its richness in natural resources, and its relatively flourishing economy that can also influence Kenya’s counterparts in the East African Community.

  • Reply TS Choong August 9, 2019 at 7:29 am

    Unfortunately Western nations and the World bank do not have enough money for these projects.

  • Reply Bazil Bazil August 9, 2019 at 9:12 am

    Yes,yes,yes!!! " generous," China will enslave all the world by these scheme!!! The little yellow chinese will treat us all as slaves!!!

  • Reply Ali Khan August 9, 2019 at 9:32 am

    Please make video with china – bangladesh Relation 2019🇧🇩🇨🇳

  • Reply Py LordVaderX August 9, 2019 at 1:22 pm

    What should we do now ? Should we let Kenya fall in USA death trap ? No We help China to build Kenya again and USA can suck it !

  • Reply fireson23 August 9, 2019 at 9:19 pm

    There is no freaking debt trap. Stop using that US state department propaganda term.

    China enters into equal partnerships with African countries and lends them money to build critical infrastructure. How these countries handle these loans and what sort of projects they approve is up to their own discretion.

    I will tell you what is debt trap. US backed IMF and World bank loans are freaking debt traps. How many developing countries are in debt to the IMF and the world bank? Look into that instead.

    Very few countries doing business with China have actually fallen into unsustainable debt with China. China has also forgiven a lot of debt to African countries. Many African countries economies are booming due to their trade, investment loans and business partnerships with China, period.

    Get over it.

  • Reply Jerome M Muriuki August 10, 2019 at 10:25 am

    I have no problem with the said infrastructure projects or Kenya's participation in China's B&R initiative. Such projects are good and with time they pay for themselves many times over due to the positive socio-economic impacts.
    The problem is kenya and corruption go hand in hand. How much of this money is actually being used as intended and how much is going into peoples pockets? 10%? 20%? 30%? It is only a matter of time before the Chinese seize Kenyan assets because these loans are not unsecured they are collateralized!

  • Reply basstrip73 August 10, 2019 at 1:26 pm

    I am sure China is not a perfect partner but come on man, Africa's former colonial overlords (and the USA) run the biggest "debt trap" scam in town via the IMF/World Bank mafia tag team. They loan money to poorer countries but as a condition force them to privatize their public services, cut back essential public benefits and allow western companies to extract resources on the cheap. Even after taking the countries they "help" to the cleaners they also expect their loan to be repaid with interest. It's usury. This scam benefits only some corrupt government officials and scruple less businessmen plus, of course, western companies who get immensely valuable resources (and labor) for next to nothing.

    Not one African, Asian or Latin American country has become prosperous by getting IMF loans. Because it is a scam designed by the west to benefit the west. Maybe China will be just the same but they have only been involved in foreign development for a very short time so the jury is still out. A channel that claims to be "objective" or "neutral" which has had nothing to say about the decades long IMF/WB scam but suddenly jumps on China is pushing propaganda. Perhaps they are doing it cynically for the clicks and page views only, maybe they have a deal with someone who is paying them to do it or they have themselves been fooled by western anti-China propaganda. Whatever the case, a serious commentator ought to think twice before jumping on the latest demonization bandwagon.

  • Reply Russ August 10, 2019 at 2:51 pm

    3:47 https://dictionary.cambridge.org/dictionary/english/gauge
    https://dictionary.cambridge.org/media/english/uk_pron/u/ukg/ukgas/ukgastr023.mp3
    https://dictionary.cambridge.org/dictionary/english/gorge
    https://dictionary.cambridge.org/media/english/uk_pron/u/ukg/ukgoo/ukgoose008.mp3

  • Reply Talloolah Moon August 10, 2019 at 8:58 pm

    It’s already too late. Africa has been recolonised by china

  • Reply John Schaeffer Mike August 11, 2019 at 6:19 am

    Better…. CHINESE,,,
    THAN BLOODY COWBOYS…
    Shooting,,, killing,,, around…..
    BLOODY COWBOYS…

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