Chinese Sinosteel Corporation to Invest in Kenyan Steel Plant

2015-05-06

The Chinese state-owned steel enterprise, Sinosteel Corporation, has signed a Memorandum of Understanding (MoU) with the Kenyan government to build a new steel plant in Kenya. The investment is expected to improve Kenya’s trade balance and foreign reserve position, for the country currently relies on imports to meet much of its steel demand.

According to Adan Mohamed, Kenyan Cabinet Secretary for Industrialization and Enterprise Development, the country’s estimated annual steel demand occupying 1.8 million metric tonnes at the end of 2013. The Kenyan steel demand is projected to reach 2.5 million metric tonnes by 2020. Furthermore, the demand is forecasted to double by 2030.

The ongoing real-estate boom in the country coupled with the rising demand from railway and road network construction projects, is expected to further increase the country’s demand for steel and steel products. The Kenyan government plans to invest billions of dollars in domestic infrastructure projects over the next 3 to 5 years. According to Mohamed, the exploration works of iron ore and coal deposits are at an advanced stage. Sinosteel’s rich experience in this sector is expected to further accelerate the implementation of these projects.

Meanwhile, Wang Jian, Managing Director, Sinosteel Corporation expressed optimism on signing the contract and stated that the growing steel demand from real estate and infrastructure projects make it the right time for Kenya to make key investment in domestic steel plants.

Based in Beijing, China, Sinosteel is a leading steel development firm since founded in 1993.