Kenya has stepped up campaigns to woo Chinese traders to invest in the country. The move is aimed at correcting the unfavourable balance of trade between the two nations.

Ministry of Trade data indicates that deficit grew to Sh44.22 billion last year, up from only Sh3.68 billion in 1997. The bid to market Kenya as the most favourable investment destination in the region is the subject of a two-day China-Africa Development Fund (Cadfund) workshop in Nairobi.

Trade minister Uhuru Kenyatta has urged the Chinese delegation to consider investing in the export processing zones where investors enjoy an array of tax incentives including a 10 year tax holiday.

Waiver of duties

"Even in the tourism sector, waiver of duties and VAT on investment, 100 per cent investment allowance for new investments in tourist hotels, and 25 per cent corporate tax for companies issuing initial public offers in the Nairobi stock exchange, are meant to spur growth in the sector and make it attractive for foreign investors," Mr Kenyatta said during the opening of the workshop.

He said the government had put in place several measures to protect foreign investors and their investments, among them a green light to repatriate capital, repatriation and remittances of dividends and interest under the Foreign Investment Protection Act

"Kenya is a member of the International Centre for the Settlement of the Investment Disputes (ICSID) and the World Bank- affiliated Multilateral Investment Guarantee Agency (MIGA), which issues non-commercial guarantees against non-commercial risks to enterprises which invest in signatory countries," Mr Kenyatta said.

Cadfund was formed as a follow up to the 2006 Beijing summit on China - Africa co-operation, where Chinese President Hu Jintao promised to improve Sino-Africa ties.