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US pours billions in Kenya to rival China dominance (Standard Digital)

July 2, 2018

The United States faces an uphill task in a fresh bid to reclaim its position as Kenya’s dominant trading partner on the back of growing volatility in the international market. This comes even as China, currently the leading protagonist in a simmering trade war kicked off by US President Donald Trump, firms its grip on much of Kenya’s revenue basket through more than Sh500 billion in State-guaranteed credit.


Earlier this year, Washington-based think tank Center for Global Development published a report stating China’s One Belt One Road mega project  - of which Kenya plays a pivotal role through the SGR and the Lapsset project - poses a significant risk of debt distress to Kenya and 68 other low-income countries.

“The primary concern is that an $8 trillion-dollar initiative will leave countries with debt “overhangs” that will impede sound public investment and economic growth more generally,” said the report in part adding that the problems will create an unfavorable degree of dependency on China.

“In Belarus, Bosnia and Herzegovina, Ethiopia, and Kenya, there could be an increase in the risk of debt distress in the short-term due to BRI-related projects,” said the report in part.

Read the full article here.

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Photo of Scott Morris
Senior Fellow, Director of the US Development Policy Initiative