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Kenya Won The Beauty Pageant At The U.S.-Africa Leaders Summit

Kenya Won The Beauty Pageant At The U.S.-Africa Leaders Summit

Nigeria, Tanzania, Ethiopia, Rwanda are some of the countries seen as investment meccas at the U.S.-Africa Leaders Summit, but at a post-summit breakfast meeting in Nairobi, businessmen and government officials said Kenya won the beauty pageant.

“By the end of the summit everyone was talking about Kenya,” said Chris Kirubi, a local business tycoon with interests in finance, manufacturing, real estate and media.

Kenyan government officials said that U.S. companies are eager to enter the Kenyan market due to the country’s strategic location as the hub of East Africa but also to take advantage of industries such energy.

Geothermal energy was of particular interest to investors at the summit. The Kenyan government claims it has the potential to produce 5,000 megawatts. The country currently produces 236.5 megawatts of geothermal energy, barely 5 percent of its potential.

Talks between U.S. and Kenyan officials and business owners are still ongoing which makes it difficult to say just how much of the $17 billion in investment promised by U.S. President Barack Obama will go to East Africa’s largest economy.

Local businessmen say that they expect that more companies will come to Kenya, not only because government officials made a fantastic sales pitch at the summit, but on the conviction that the country’s fundamentals are solid.

Nicholas Sowden, a U.S. entrepreneur who runs a chain of health clinics in Kenya, said that the over-subscription of Kenya’s debut sovereign bond is an endorsement that Kenya has long-term prospects.

It will, however, be a herculean task for the government to untangle the red tape and address the runaway insecurity that has brought vital industries such as tourism to a comatose state, Sowden said.

“If President (Uhuru) Kenyatta and his team can help smooth over fears on insecurity, I wouldn’t be surprised to see the announcement of several new investments in Kenyan infrastructure,” Sowden told AFKInsider. “Additionally, they may make some progress on issues like direct flights between Nairobi and the U.S., reducing tariffs on imports from Kenya to the U.S. and the joint military efforts in Somalia.”

This year, Stone Cold, a U.S.-based ice cream chain, entered the Kenyan market and is scheduled to open its first store in Nairobi in September.

Other businessmen at the post-summit meeting said that as larger companies enter the market, the benefits will eventually trickle down to local small and medium-sized enterprises.

Chevron Corp., Citigroup, Ford Motor Co., Lockheed Martin Corp, Marriott International and Morgan Stanley are some of the large companies that went to the U.S.-Africa Summit in search for lucrative deals.

Ndambuki Kasanga operates Sears, a chain of pharmacies in Kenya.

“As a development partner the U.S. offers a vast market for Kenyan goods, and with its capital-rich economy, a cheap source of money to loan to businesses here,” Kasanga said. “This I expect will trickle down into the lower segments of business.”

Obama said in a speech at the forum, “The United States is determined to be a partner in Africa’s success. A good partner, an equal partner and a partner for the long term.”

The summit attracted more than 90 companies that made $17 billion in commitments.