Infrastructural Development as a Determinant of Kenya – China Economic Relations
Abstract
This study sought to establish if Kenya’s purposeful infrastructure investment anchored
largely on Chinese financial support has led to improvement and modernization of
Kenya’s infrastructure network, economic growth and has been the single determining
factor in Kenya-China economic relations. The study was based on a Rational Choice
Theory as the guiding theoretical framework, and used longitudinal research design to
determine the effects of infrastructural development on economic growth and intensified
Kenya-China economic relations. It was also anchored on a qualitative design technique
and applied case study approach to analyze the causality of processes at all levels. The
study adopted multiple sources of information ranging from primary data to secondary
data. The study found that foreign direct investment was an essential stimulant to
economic growth. It also found that for Kenya to improve and expand its infrastructure
network it needed massive resources that it was unable to provide autonomously, forcing
the country to resort to external support. In this regard, China has become a major source
of financial support to Kenya. The study found that compared to methods applied by other
bilateral donors in development projects, the Chinese approach was starkly different. The
speed of completion stands out and this is attributed to the fact that project cycles are
relatively shorter. In the Chinese case, identifying the project to completion and handing
over never goes beyond five years, whereas in the European Union or Japanese cases the
process could take up to 10 years. The study further found that Chinese companies were
discriminate providers of employment as they tended to employ mainly non-professionals
and casual workers, thus affecting expected technological spillovers. China’s FDIs also
distorted local saving potential which could render Kenya perpetually dependent and
hostage to China’s conditionality. The approach to local content was also spurious. The
study also established that as far as cost performance measure was concerned most
projects suffered cost overruns because standard economic parameters that underpin
viability of projects seem not to have been met. The study concludes that poorly managed
infrastructure investment manifests economic and financial woes bedeviling Kenya today.
Unless Kenya adopted investment growth policies targeting high-quality but less debt -
dependent infrastructure investment model Kenya was bound to experience economic and
financial instabilities. The Chinese infrastructure investment model must be tempered by
archetypes embraced by progressive market-based economies. This notwithstanding,
Kenya-China economic relations have been on the rise.
Publisher
University of Nairobi
Subject
Infrastructural DevelopmentRights
Attribution-NonCommercial-NoDerivs 3.0 United StatesUsage Rights
http://creativecommons.org/licenses/by-nc-nd/3.0/us/Collections
- Faculty of Arts [657]
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