Interview : Liam Fox
What makes Kenya a strong investment destination?
LIAM FOX: The UK and Kenya have a long, shared history, and enjoy strong ties between governments, businesses and people. These links are deepened by the 30,000 British nationals who live in Kenya, the 150,000 British tourists who visit each year and the 200,000 people of Kenyan origin living in the UK.
Kenya is a leading member of the Commonwealth and a key ally. In commerce Britain and Kenya share a uniquely strong bond; we are the second-largest buyer of Kenyan goods and services and one of the top sellers to Kenya. The UK is Kenya’s largest foreign investor, and 200 UK companies operate there including four of the top-six corporate tax payers. Kenya remains a vibrant and attractive destination for UK firms establishing themselves in Africa, and we have seen a number of major investments in recent years that reflect this.
How can the UK contribute to investment in Africa?
FOX: I believe the UK is uniquely placed to help build international confidence in Africa as an investment destination, and particularly to help African countries promote themselves in the City of London. In order to do this, we are working with investment promotion agencies in African countries – such as KenInvest in Kenya – to highlight important statistics, incentives and case studies to UK investors. Furthermore, we are providing African governments and companies with a platform to make their pitch in the UK. In 2018, for example, we are committed to adding four new members to our commercial team in Kenya.
How can UK investors contribute to the diversification of economies in Africa?
FOX: UK businesses in Africa are notable for prioritising social impact in their work. They set high standards for competitors, and typically reinvest a high proportion of revenue in their local communities and value chains. UK firms rank among the most respected firms in Kenya, and are dedicated to drawing on local talent and expertise, and localising management.
What are the key challenges that businesses face when operating in Africa?
FOX: As with any region, there are challenges to doing business in Africa. Individual markets can be volatile, with rapidly changing financial landscapes. There are many misconceptions among UK companies about the realities of doing business in Africa, and that is something we need to correct. Companies can sometimes lack the appetite to invest in building the long-term relationships and presence on the ground required to secure contracts on the continent.
UK Export Finance (UKEF), the UK’s export credit agency, helps mitigate some of the risk by offering export insurance to ensure exporters get paid even if they cannot access coverage from the private sector. UKEF’s role is to ensure that no viable UK export fails for lack of finance or insurance. It also provides financial support to help exporters offer attractive finance to their buyers and access working capital. It has provided millions of pounds in support for projects in Africa, and has up to £1bn in capacity to support trade with Kenya.
How can the UK enhance Africa’s human capital?
FOX: The UK is committed to supporting development in Africa. We have partnered with many states on training and education at all levels, from primary schools to courses for future business leaders.
We promote UK-based professional qualifications, and with the Chevening Scholarship programme we are helping many of the continent’s brightest students access tertiary education in the UK. In December 2017 an additional £16m of UK funding was announced for the World Trade Organisation’s Enhanced Integrated Framework, which helps governments and businesses in developing nations build the capacity, infrastructure and policies needed to successfully trade internationally.
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