The Effects of Association

Statement of aims

In the light of China-Africa relations (especially Kenya – the topic of this study), here are the research aims and objectives. The researcher will also examine how the China-Kenya relationship has evolved.

Identification of infrastructure-related projects in Kenya in which China is actively involved

Conduct proper assessment and analysis of the fundamental gains and losses resulting from the involvement of China in different investment projects in Kenya (especially infrastructure development and implementation)

Analyse the sector-specific challenges and growth opportunities of Kenya resulting from the economic relationship with China: are these investment prospects sustainable (especially infrastructure development)?

Suggest development strategies for Kenya infrastructure that could result in a win-win situation for both countries and strengthen their ties

These research objectives fit the following research questions:

How is China involved in Kenya’s infrastructure related projects?

What are the possible gains and losses from China’s involvement in delivering infrastructure projects in Kenya?

What are the challenges faced by different sectors in Kenya in relation to its economic relations with China?

How can Kenya and China improve their relationship and strengthen their ties?

Literature Review

Background and research context

Communist government of The People's Republic of China created diplomatic relationship with the Republic of Kenya for the first time on December 14, 1963 immediately after Kenya gained its independence from the British colonialism. An analysis of the initial years of the founding of the associations stuck between the two countries saw a reasonable growth in economically and in infrastructure (Wanjiku et. al., 2018). However, after 1965, a considerable decline in the association between the two countries. It can thus be association with a level of charge d’affaires class and towards the commencement of 1970s where strategic reports show some gradual return to the ordinary status. Notably, when President Daniel Moi came to power in 1978, the association between Kenya and China gained momentum in general development. This was characterized by numerous shared visits and cooperation which could be associated with outstanding achievements in various fields in the government. Towards the end of 2002 which saw the establishment of a new government in Kenya led by the then President Mwai Kibaki marked another critical moment for the relations as the president expressed to retain relations with China (EM, 2018). The President seemed to deepen the relationship and expand its cooperation and friendship through initiation of many bilateral talks and business contracts. (EM, 2018).

Ever since the diplomatic relationship was establishment, the projects of support and aid provided by China towards the government of Kenya primarily comprised of:

Construction of Moi International Sports Center in Nairobi

Initiation and construction of methane-generating pit around the country

The construction and expansion projects of Eldoret hospital in Eldoret town.

Gambogi-Serem Highway.

Thika Super Highway

Standard Gauge Railway (Mirir, 2019)

These were, among other projects, all listed in the appendix including the recently constructed Thika Superhighway and the construction of the Standard Gauge Railways, which runs from Mombasa to Malaba via Nairobi. The relationship between the two countries has increased over the recent years with significant establishment of the bilateral trade value, which oversees the exportation, and importation of goods between the two countries. For example, the government of China exports various goods to Kenya. These include: domestic electric appliances, manufacturing and farming tools, fabric goods, merchandise for daily use, construction materials as well as pharmaceutical drugs. On the other side, some of the exported goods to China include: black tea, coffee as well as leather-goods, among others.

According to the statistics by the global trade, 2002 was significant for trade value between Kenya and China reaching an estimation of US$ 186.37 million (Wanjiku et. al, 2018). From the same statistics, Chinese export was equated to about US$ 180.576 million as the import stood at US$ 5.798 million in the same fiscal year (Miriri, 2019). The joint beneficial collaboration involving both China and Kenya started in 1985 and it has been growing year after the other. Currently, there are over 50 Chinese firms running their businesses in the country. Some of these companies include:

Jiangsu International Economic and Technological Cooperation Co.

Sichuan International Economic and Technological Cooperation Co. Ltd.

China Road Bridge Construction (Group) Corporation

China Import and Export (Group) Corporation for Complete Sets of Equipment, among others (Kioko, 2012).

The bilateral financial system and trade agreements agreed between Kenya and China consist of: "Agreement on Economic and Technological Cooperation between the People's Republic of China and the Republic of Kenya", "Agreement on Trade between the People's Republic of China and the Republic of Kenya" (1978) and among others. In addition to that, the two countries also signed the collaboration for cultural cooperation in 1980. They agreed on a protocol for the support in advanced education. From this protocol China took the initiative with Egerton University with an alliance for training and research with 2 tutors who sent trains and learned from China (Niu, 2013).

Review of similar research studies

What has been written about the economic relationship between China and Kenya? Onyango (2007) stated in his analysis of the China-Kenya economic relationship that most literature has not properly presented the resounding entry of China into Africa. He argues that most research on the subject is about the malevolent threat of Chinese investment strategies accompanied by a flood of cheaply manufactured products; and that discussions on the economic impact of China on Africa normally sideline Kenya (Onyango, 2007).

The China-Kenya relationship is mainly based on the acquisition of mutual benefits and advantages over time. China’s share of Kenya’s external development assistance increased from 0.08 percent in 2000 to 13% in 2005 (Alden, 2007). Most Kenyans consider this a significant breakthrough in the progress and development of the country, especially in infrastructure.

Sanghi and Johnson (2016) discuss misconception regarding the existing China-Kenya economic relationships; in particular on the infrastructure development wherewith the People’s Republic of China would expand its alliance (for instance that China floods the market with its cheap goods and destroys the Kenyan economy). With more Chinese goods entering the Kenyan market, retailers and consumers have more choices (Caniglia, 2011).

Another idea, debunked by statistics, is that China will bring its own labour force into the country. Chinese companies have hired Kenyans for 78% of full-time work and 95% of part-time work on infrastructure projects (Alden, 2007).

The Chinese government, investors, and companies in Kenya envisage more than just using Kenya’s natural resources. Chinese companies have invested up to $150 million to develop communication sector infrastructure and $68 million for the automotive and transport sector (Taylor, 2006).

Research gaps in existing literature

The issues of modernization of various sectors of the general economy are a major factor, which emerges as an economic gap especially on macroeconomic and long-term stability of the stability and relations. A walk around the streets of Nairobi might offer a notion that Chinese commodities could have been in Kenya for years – practically occupying all areas of the lives majority of Kenyans. However, China has not always been the foremost resource of imports for the country. The country became the leading source of goods into Kenya in 2015, following her aggressive marketing strategy as well as a focus on the close ties with the East in the initial years of the Jubilee administration (TradeMark, 2019). This saw imports from China grow faster. By 2017, they accounted for over a fifth or 22.6 percent of all goods coming into Kenya (Gurjar, 2020). According to Kenya National Bureau of Statistics (KNBS), the value of imports from China in 2017 reached Sh390 billion (£3 billion), a 20 percent jump from Shs 337 billion or £2.59 billion in 2016. This is against the total imports of Sh1.7 trillion or £1.3 trillion during the year. China as a source of imports for Kenya is in comparison to India that stood at Sh170 billion (£130 billion) in 2017, a 17 per cent decline from Sh205 or £157 billion in 2016. India was the largest exporter to Kenya in 2014. The country has however sustained a declining trend since 2014 when the value of imports from India stood at Sh264.5 or £2.03 billion, which was in comparison to China’s Sh248.6 or £191.3 billion in the same year (2014). India has been a source of medicine, medical equipment and refined petroleum (Gurjar, 2020). Among the factors that have resulted in the rapid growth of imports from China include the cheap prices of Chinese goods, aggressive marketing of products and services by its Government abroad as well as Chinese contractors snapping mega infrastructure projects that are built using Chinese equipment and raw materials such as cement and iron (Meja, 2018). Jubilee administration’s focus on the East in its initial years came after the West disapproved Uhuru Kenyatta’s and William Ruto’s candidature. This was due to their cases at the International Criminal Court. It may have also helped firm up China’s trade grip on Kenya (Bertollo, Appolloni, Izquierdo, Angelis, & Vesenjak).

Although there have been several studies that have explored the effects of Chinese investments on the infrastructure sector, however, a vast majority of these studies have focused on the African and sub-Saharan infrastructure industry. Therefore, lack of previous knowledge and information about the topic in context of Kenya will be a key motivating point for conducting the current study. It can be said that this study will bridge the gap of dearth of information about effects of Chinese investments on Kenya’s infrastructure. Through this dissertation, the researcher will be able to analyse how investments from China have helped infrastructure projects in Kenya or how they have improved operations and speed of such projects in the African nation.

Another gap that can be observed from the current studies is that a large number of the studies have focused on determining how China has been the most beneficial part in the China-Kenya relations. But there are only a few studies have examined this aspect from Kenya and its infrastructure sector’s point of view. Thus, the current study will provide an altogether new lens that will help in exploring and understanding if Kenya too has received any significant benefits from this deal or not. Such information can then be useful for future researchers who might analyse ways in which this deal has been implemented in the two countries.

Importance and contribution of proposed research

This research will focus on the economic cooperation between the two countries from 2003. Basically, the research will factor in issues that have been affecting the two countries after the political transition, which saw the formulation of significant national economic recovery plan, which became later, the focus on the blueprint for the vision 2030. In this vision the role of China is very important mainly due to the reason that the country will invest heavily in Kenya and therefore will have a significant impact on growth and development of China. This research would assist in understanding the bilateral relationship, which has been facing significant criticism over the years.

The research will also focus on the possible gains and importance of China-Kenya relationship. This will be based on various factors such as strategic growth, infrastructure, and economic gains. Among the major topics that this dissertation will focus on is the success and importance of bilateral relation on trade between the two countries and its effects.

Research outline

Research Design Data description

The research design focuses on various data collection methods some of which are based on various economic year reports. Major focus will be given on collecting and using secondary data in the study. Herein, factors such as infrastructure, economy, product and differences in characteristics and traits of the consumers will be given attention to. These will help in understanding relationships between the two countries. Furthermore, to collect the data, qualitative open-ended questionnaire survey will be used. Thus, the data will be analysed through a qualitative approach. The main reason for selecting this method for data analysis will be the fact that it would help in assessing relations between the two countries.

Confidentiality and ethical consideration

The names of the participants are not revealed to protect their rights. In addition, the research will be carried out according to the ethical codes stated by the university and its ethics committee. This includes confidentiality in collecting data, analysis, as well as sharing data. This includes avoiding issues related to gender, racial, or any other discrimination in carrying out the research.

Method and choice of analysis

There will be an open-ended qualitative questionnaire survey with multiple-choice questions. The research will be primarily descriptive in nature and mainly about the effects of relationship between China and Kenya. The secondary data will include China’s investment practices in different regions, general business practices of CCFs in Africa, and case studies of CCFs and other Chinese-owned firms in Kenya.

Apart from this, primary data will also be collected in the current study. Through this kind of first-hand information, the researcher will be able to obtain better data and then analyse it thoroughly so that the research topic can be studied. To collect the primary data, the researcher will focus on conducting interviews of experts from both the nations. Herein experts will be economists, teaching economics in local universities. Along with this, the researcher would also interview managers of leading infrastructure companies in Kenya. To recruit these individuals in the study, the researcher will have to visit Beijing and interview 12-13 economic professors in local universities. Similar approach will be used for interviewing the professors teaching in Kenyan universities and managers of infrastructure companies. They will either be contacted through email or in-person. The sample size for the interviews will be 25, while for the questionnaire survey it would also be 25. Thus, in total the sample size would be 50. By interviewing these individuals, the researcher will be able to explore and analyse this relationship in a detailed manner and thereby determine its impact on the infrastructure in Kenya.

The following are relevant to understand the gains and losses from Chinese involvement in Kenyan infrastructure:

The local economy

Contribution to infrastructure in terms of long-term visionary goals

Financial growth of local enterprises in Kenya

Employee rights recognition

The expected outcome is to have an analysis of the effects of the bilateral relation between China and Kenya. This study is based on the economic growth, and also effects of aid on growth of the Kenya’s economy. Through research methodology and data collection methods, it might be observed that China’s investments have proved to have substantial impact on Kenya’s economy. The expected results are based on comparison of economic growth in the country compared to recent years.

Resource needs and funding

Since the project is large-scale, it would be broken-down into small and manageable parts. Research progress would include a phased approach, which will consider various factors such as interim goals, adherence to deadlines for management of the team members, as well as provision of project lifecycle, which would show accountability. Therefore, for efficient utilization of the funds, the research would be organized into small pilots, which would otherwise provide a manageable and affordable approach in managing the funds for the study.

Following information can be vital for the current study and also help to conduct it appropriately.

Letters of testimonials

Business cards for the related projects

Journal articles, newspapers and other relevant information related to the information being sought.

Annual financial reports.

Pamphlets form for the standards requirement for the project.

Brief description of work done so far e.g. brief references to literature review, any draft, chapters etc.

As far as now the research has covered various chapters

Introduction

Literature Review

Research design and methodology

Data collection and Analysis

Discussion

Outline of researcher development activities

Research analysis through questionnaires

Data collection through Analysis

Qualitative research through utilization of secondary data research methods.

Analysis of the recent financial and development reports between the Kenya and China

Prior qualifications and training

Communication and critical thinking skills

There should be in alignment and curriculum assessment design

Seminars and conferences attended

I have attended two workshops on building my knowledge about ways to write a literature review. These helped me in gaining better understanding about this section in a dissertation.

Presentations

The presentation would be made in PowerPoint slides at the end of the project after the approval from the supervisors. The presentation would be categorical and would follow the protocols of the Institution as well as other related regulations by the board of supervisors.

CONCLUSION

The study Kenya China relations: portrait of economic relations in the new millennium has been focused on understanding the impact on Kenya’s economy resulting from economic cooperation between Kenya and China in the past 5 decades with emphasis on economic cooperation since 2003. Additionally, the paper sheds light on the conditions necessitating the in-depth engagement and cooperation with China in Kenya’s infrastructure sector is deeply entrenched in Kenya’s economic blue print and long term development strategies. To address the gaps in macroeconomic stability Kenya turned to China to finance modernization of strategic sectors of economy hence cementing the political relations between the two states at the present and the future.

REFERENCES

Bertollo, M., Appolloni, O., Izquierdo, J. P., Angelis, F. D., & Vesenjak, E. L. (n.d.). China and the Different Regional Approaches in Africa.

EM, P. S. (2018). Kenya-China Trade Relations: A Nexus of “Trade not Aid” Investment Opportunities for Sustainable Development. Journal of Economics and Development Studies, 6 (2), 1-10.

Farooq, M. S., Yua, T., Zhu, J., & Feroze, N. (2018). Kenya and the 21st Century Maritime Silk Road: Implications for China-Africa Relations. China Quarterly of International Strategic Studies, 4 (3), 401-418.

Fiott, D. (2010). The EU and China in Africa: The Case of Kenya. Madariaga Paper, 3 (5), 1-15.

Kenneth King. (2010). China's cooperation in education and training with Kenya: A different model? International Journal of Educational Development, 30 (5), 488-496.

Kioko, P. M. (2012). A Study on Chinese’s Economic Relations with Africa: Case Study Kenya. Nairobi: Kolping Organization of Kenya.

Wanjiku, S. et. al., (2018). Effect of Kenya’s Bilateral Relations with China on Economic Growth of Kenya. IOSR Journal of Economics and Finance. 9(5). pp. 13-21.

Miriri, D., (2019). Kenya opens $1.5 billion Chinese-built railway linking Rift Valley town and Nairobi. Reuters. [Online]. Available through: . [Accessed on 7th February 2020].

Niu, C., (2013). China's educational cooperation with Africa: toward new strategic partnerships. Asian education and development studies. 3(1).pp. 31-45.

Meja, V., (2018). The Case of China’s Development Co-operation in Infrastructural Development in Angloa and Kenya. [pdf]. Available through: . [Accessed on 7th February 2020].

Gurjar, S., (2020). Understanding the geopolitical significance of India’s aid to Madagascar. [Online]. Available through: . [Accessed on 7th February 2020].

TradeMark., (2019). Unfavourable China-Kenya trade leaves Sh380 billion gap. [Online]. Availble through: . [Accessed on 7th February 2020].