Kenya in conjunction with a Chinese company- Sinosteel is planning to construct a multi-billion steel plant that will see the country’s trade balance progress to the next level due to the high consumption of steel-related products in the country.
This follows Kenyan government’s, together with Sinosteel, recent agreement in regards to the development of the project. The new steel plant will help the country counter an expected demand of 2.5 million metric tonnes of steel per year, which is expected to double by 2030 according to Adan Mohamed, the now Cabinet Secretary for Industrialization and Enterprise Development.
“Investment in a steel plant in Kenya will significantly improve our trade balance and foreign reserve position given the significant consumption of resources in import of steel products,” said Adan Mohamed.
According to records, in 2013, Kenya experienced a large account deficit after it imported approximately 1.8 million Metric tonnes of steel. This is direct proof that the amount of steel required in the country is higher compared to other years and this is majorly because of the increment in infrastructure projects taking place.
Some of the infrastructure projects that the Kenyan Government is working on are the mega Standard Gauge Railway, LAPSSET corridor development, and other numerous road constructions and also the flock in real estate business.
The raw material for steel production- iron ore deposits are present in several parts in the country like; Meru, Kitui, Taita Taveta, Homa Bay and Kakamega, while coal that is needed to heat the ore to remove impurities has been discovered in Kitui.