South Korea Eyes Housing Deals in Kenya’s Big 4 Development Plan

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Visiting South Korean Prime Minister Lee Nak-yeon has expressed interest in supporting Kenya’s affordable housing plan alongside cementing existing bilateral ties in energy, agriculture and healthcare.

The South Korean PM is on a three-day Kenya visit where he led a trade delegation from Seoul on a deal-hunting mission, including executives from Korean giants such as LG, Samsung and Hyundai.

“We’re keen to provide affordable housing support to Kenya if the government wants us to,” the PM said on Friday during Korea-Kenya Business Forum that seeks to spur more Korean startups to make entry into east Africa.

Affordable decent housing is among the four development pillars that President Uhuru Kenyatta has identified for implementation in his second, final term.

Agreements

Nairobi and Seoul already have cooperation agreements in agriculture and fisheries, energy and infrastructure, along with healthcare and now looks to add housing.

During the visit, the Korean Premier met President Kenyatta and oversaw the signing of several memoranda of association (MoU) with Kenyan firms.

For instance, Korea Trade Investment Promotion Agency (Kotra) inked a deal with Chandaria Industries to support startups from across the two countries through the Chandaria’s accelerator programme.

The other pact involved Korea Western Power and local firm Sosian Energy in the joint development of a 35-megawatt geothermal power plant in Menengai basin, Nakuru.

“The two organisations are finalising a 25-year Operations and Maintenance (O&M) program in relation to a 35 MW geothermal plant in Menengai,” the pair said in a joint statement.

Seoul seeks to ride on the second MoU to increase shipments of Korean power generation equipment to Kenya’s steam fields.

Sosian Energy is among the three companies that State-owned Geothermal Development Company (GDC) awarded exclusive rights to build the Menengai geothermal project in 2014 under the public-private partnership model.

Each was to construct 35 megawatts or 105 megawatts in total, but construction has delayed till this year.

The other two selected firms are New York Stock Exchange-listed Ormat Technologies and Mauritian firm Quantum Power.

Gideon Moi’s stake

Last year, steel and cement tycoon Narendra Raval, the owner of Devki Group, became the full owner of Sosian Energy after buying Baringo Senator Gideon Moi’s stake in the company.

Korean firm Hyundai, along with Toyota Tsusho constructed the 280-megawatt geothermal power plants in Olkaria belonging to power producer KenGen, which was added to the national grid in the second half of 2014.

Kenya imported Sh17.6 billion worth of goods from Korea last year compared to Sh2.4 billion that Nairobi sold to Seoul, amounting to a trade imbalance in favour of Korea.

At Sh17.6 billion, Korea’s imports to Kenya are the fifth largest from Asia, behind China, India, Indonesia and Japan.

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