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Source: www.africaecon.org

Africa Economic Institute

Kenya-Iran to Strengthen Ties


Kenya's growing need for energy has encouraged the country to increasingly expand relations with oil and mineral supplying countries. Kenya's recent attempt to strengthen trade with Iran and explore possible nuclear power cooperation, reflects the Kenyan government's increased focus on securing energy supplies, as well as its growing efforts to…



Kenya’s growing need for energy has encouraged the country to increasingly expand relations with oil and mineral supplying countries. Kenya’s recent attempt to strengthen trade with Iran and explore possible nuclear power cooperation, reflects the Kenyan government’s increased focus on securing energy supplies, as well as its growing efforts to explore alternative energy sources, while at the same time, strengthening economic collaboration amidst the global economic crisis.

Currently, Iran exports to Kenya consist of industrial oil, chemicals and carpets, whereas Kenya’s exports to Iran rely mainly on tea. To strengthen bilateral trade, both countries signed several agreements last week, aimed at reducing bureaucracy and expanding traded goods. In fact, Kenya already plans to begin exporting beef and fish products to Iran in the next couple months. The recent trade agreements are expected to boost bilateral trade volume to $500 million by the end of next year.

Moreover, the two governments are expected to expand transportation and tourism between the two countries, by establishing direct flights from Nairobi to Tehran, and a shipping line linking both countries. Iran will also aim to build a trade center in Nairobi.

Infrastructure developments were also discussed, with Iran planning to invest in Kenya’s roads and water systems.  More significantly however, both countries signed important agreements on energy, including possible collaboration in nuclear power projects.

Kenya’s goal to become a fully industrialized middle-income country by 2030 is highly dependent on the country’s ability to satisfy the increasing domestic energy demands. Volatile oil prices, along with the country’s lack of  abundant natural resources, have made energy security a progressively important issue.

Currently, Kenya relies on only 1,300 MW of power, a small figure compared to South Africa’s and Iran’s generated power of over 40,000 MW.  Although Kenya has significantly improved its power generation, with total power growing by18% in the last couple years, the country  currently needs at least 10,000 MW to meet the growing demand fueled by industrial growth.

In 2006 and 2007, Kenya imported over $1.4 million and $1.5 million respectively,  worth of petroleum products to satisfy the country’s growing economy. The very high cost of petroleum has pushed the government to increasingly look for alternative sources of fuel.

In fact, some industries, while faced with energy shortages,  have resulted to other sources of fuel, such as generating power from sugar waste, tea, coffee husks and timber.  An Iranian company has already started plans to construct a power plant in Nairobi and a gas plant in Mombasa. 

Nuclear power has been an area of growing interest as the government struggles to keep up with energy demand. While the use of nuclear power is still highly controversial, the Kenyan government has argued that it provides a cheaper and less environmentally harmful source of energy. The government has already proposed the development of a 300-1000 MW nuclear power plant over the next 7 years.

Michael Mengala, a Nairobi University professor, argues on the other hand that, “the country has inadequate manpower and lacks a policy to handle such sensitive technology”. Adding that “in Kenya, we are disadvantaged since we don’t have a national policy on nuclear energy and highly skilled manpower that is needed to handle such a highly sensitive sector including nuclear reactors”.

However, there seems to be a growing consensus that if administered correctly, nuclear power might be extremely beneficial to Kenya. Although first,  the government must show a strong commitment to invest in nuclear technology, as well as develop comprehensive and timely policies, including waste management and disposal.

Source: www.AfricaEcon.org
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Source: www.africaecon.org