00:00:03
[Music]
00:00:17
Ambassador odembo thank you so much for
00:00:19
joining us today thank you thank you for
00:00:21
having me before we talk about Kenya I'd
00:00:24
like to ask you about Africa's place in
00:00:26
global business what business
00:00:29
opportunities does Africa offer and why
00:00:32
do so many companies Overlook them thank
00:00:36
you very much for your question a good
00:00:38
question an important question I think
00:00:39
for the entire International uh business
00:00:43
Community uh the fact of the matter is
00:00:45
at the moment we contribute very little
00:00:48
about 1 and a half% to the global to the
00:00:51
global trade so for that reason it
00:00:53
appears to most investors and most
00:00:55
business people uh that Africa isn't
00:00:58
particularly active in terms of business
00:01:00
trade uh on the other side of that is
00:01:03
the fact that U Africa is the continent
00:01:06
that uh so all roads will be leading to
00:01:10
uh because of some of the things that
00:01:12
are happening in Africa at the moment um
00:01:15
arising uh middle class we are
00:01:17
developing African governments are
00:01:19
investing heavily in
00:01:21
infrastructure uh we are also uh in a
00:01:24
situation where um we we we hold under
00:01:29
continent riches and commodities that uh
00:01:32
the world economy values and the world
00:01:35
economy requires in order to keep
00:01:37
growing the world economy um and and so
00:01:40
we are hoping that with all the riches
00:01:42
and the resources that we have and the
00:01:44
Commodities that we know are precious to
00:01:46
the world uh and that the world is
00:01:48
beginning to turn its head towards
00:01:50
Africa we want to position ourselves uh
00:01:53
and make sure that we are ready to do
00:01:55
business with the rest of the world and
00:01:57
and grow that percentage from 1 5% to
00:02:00
you know 10% in the very near future cuz
00:02:03
we think we have a lot to offer to the
00:02:05
continent and the fact of the matter is
00:02:07
uh that those who are investing who are
00:02:10
currently uh uh on the continent uh are
00:02:14
doing very well that's great if you were
00:02:17
to look from the perspective of somebody
00:02:19
outside the region uh just looking
00:02:23
outside into Africa how would you
00:02:25
segment the African Market uh what are
00:02:28
the regions that are most promising in
00:02:30
terms of investment I think in terms of
00:02:33
investment I would of course favor uh
00:02:35
East Africa because uh that's where
00:02:37
Kenya is located uh but you also must
00:02:40
appreciate the fact that uh the
00:02:42
continent is beginning to think
00:02:44
collectively and and so we are looking
00:02:46
at Africa as an
00:02:48
investment destination and as a trading
00:02:52
block uh and and as such what the
00:02:55
continent has done and the African Union
00:02:57
with the leadership of the African Union
00:03:00
uh we have segmented the continent into
00:03:03
various Regional economic
00:03:06
blocks by and large the regional
00:03:08
economic blocks are beginning to do very
00:03:10
well some of them are fairly young uh
00:03:12
the East African Regional block for
00:03:14
example with a population of about 150
00:03:16
million that's Kenya Uganda Tanzania
00:03:18
Rwanda and Burundi uh offers a
00:03:21
significant opportunity because uh we
00:03:24
have a customs protocol at the moment uh
00:03:27
that has increased quite significantly
00:03:29
the the uh trade between the countries
00:03:32
uh a few months ago we try uh we signed
00:03:35
uh the five countries uh in the region
00:03:37
signed a free market and free trade uh
00:03:41
protocol which now enables us to move uh
00:03:45
uh Goods Services uh and people across
00:03:48
the boundaries without any any hitches
00:03:50
we are investing heavily in the
00:03:53
infrastructure within the region with
00:03:55
major roads and corridors coming from
00:03:57
the port and the Indian Ocean going all
00:03:59
the the way into southern Sudan going
00:04:02
all the way into Ethiopia going all the
00:04:03
way into Randa and Burundi and to EAS
00:04:05
Eastern uh DRC so I I see uh tremendous
00:04:10
opportunities uh within the East African
00:04:13
region uh but the South African
00:04:15
development Community as well uh sadic
00:04:18
uh is also doing equally well in terms
00:04:20
of building Regional infrastructure and
00:04:23
increasing trade and opening up the
00:04:25
region as a whole so that if you are
00:04:28
doing business in one country you have
00:04:31
access to the rest of uh of the region
00:04:34
as well uh there's also the co the
00:04:36
common market for East and Southern
00:04:38
Africa of which Kenya uh is a member and
00:04:41
and a leading player within that and so
00:04:44
again by setting shop and doing business
00:04:46
with Kenya uh you have not just the
00:04:49
possibility of the East African
00:04:50
Community this population of50 or so
00:04:54
million you have the population of the
00:04:56
East and Southern African countries some
00:04:58
18 or so countries a population of 400
00:05:01
million uh Kenyan business people are
00:05:04
already investing quite heavily because
00:05:06
there is a market in that East and
00:05:09
Southern African region so I would say
00:05:11
uh prospects are very good in the east
00:05:12
African uh region when we talk about
00:05:15
investment we usually refer to
00:05:17
opportunities but we also have to
00:05:19
consider risks that's right what what
00:05:21
would you regard as the principal risks
00:05:23
of doing business in Africa that
00:05:26
International investors should be aware
00:05:28
of and how can they
00:05:30
uh protect themselves against those
00:05:33
risks there has been uh for a long time
00:05:37
uh this perception that uh granted there
00:05:39
are risks and and any business person
00:05:41
going to do business anywhere outside
00:05:44
the the environment in which they are
00:05:47
comfortable outside of the environment
00:05:49
in which uh they're familiar will be
00:05:52
subjected to some element of risk
00:05:55
regardless so there is no place where
00:05:56
you go and invest and there is no
00:05:59
element of risk risk the kinds of risks
00:06:01
that businesses and investors have had
00:06:04
to deal with on the continent are
00:06:06
related to for example civil wars that
00:06:09
we have seen uh come and go uh we have
00:06:14
had uh risks uh related to uh
00:06:19
unreliable
00:06:20
uh uh uh Judiciary processes and
00:06:24
recourses in court uh so that if you uh
00:06:28
had some uh
00:06:30
um uh if if you had issues uh that
00:06:35
pertain to uh business uh contracts and
00:06:40
so forth uh that the recourse in courts
00:06:44
was not readily and easily available the
00:06:46
court procedur is taking too long uh but
00:06:48
we have a situation where again uh if
00:06:51
you look at the continent in the last
00:06:53
few years uh very few places where there
00:06:55
are civil wars uh compared to 10 years
00:06:57
ago where at any given time time there
00:07:00
was an average of about 10 countries
00:07:02
African countries and every time there's
00:07:04
a war in any given country uh again the
00:07:08
mindset about the continent is that you
00:07:10
know there's war in one country there
00:07:12
are some people who imagine there's war
00:07:15
all over uh the continent and that's
00:07:17
just a geography lesson issue that uh
00:07:19
that needs to be sorted out that these
00:07:21
are different 53 different countries and
00:07:23
that when something is happening in one
00:07:25
country um uh so I I think and if you
00:07:28
look at what has happened in the last
00:07:29
few years in terms of improved
00:07:33
governance uh all the countries are
00:07:36
becoming more democratic they're having
00:07:37
elections more
00:07:39
regularly um so the sort of typical
00:07:42
tensions that would result in Risk
00:07:45
causing uh situations those have been
00:07:48
minimized to to a great extent uh Wars
00:07:51
uh around the time of Elections uh Civil
00:07:54
Wars between different communities in a
00:07:56
country uh fighting over natural
00:07:58
resources between one community and
00:08:00
another um I think by and large uh the
00:08:04
you know uh We've overcome to a great
00:08:06
extent those kinds of challenges and U
00:08:09
the continent is is looking ahead to
00:08:12
just being a continent where there's a
00:08:14
certain amount of predictability because
00:08:16
that was the other risk business people
00:08:18
like to know that there's a certain
00:08:20
amount of predictability um in in
00:08:23
different
00:08:23
ways um so I think uh we now have all
00:08:28
the ingred ingredients uh that minimize
00:08:31
all those risks that people feared
00:08:33
before uh and one of the ways to to uh
00:08:37
to establish that is for a prospective
00:08:40
business person investor to talk to some
00:08:43
company uh that is already doing
00:08:46
business uh on the continent has been
00:08:48
doing business over a period of time and
00:08:51
they would be able to tell you the kinds
00:08:53
of changes that have taken place over
00:08:54
the last you know 10 years 5 years
00:08:57
particularly and and and how much we
00:08:59
have uh managed now as countries and as
00:09:02
regions to minimize risks uh to
00:09:06
investors because we all appreciate now
00:09:08
uh that we've been left behind and and
00:09:10
therefore we must do what is necessary
00:09:14
uh to create an enabling environment for
00:09:15
the private sector and and business and
00:09:17
and investment both local and foreign
00:09:20
direct investment as well it's quite
00:09:23
likely that these days if we were to
00:09:24
pick a a company that has been investing
00:09:27
in China uh in in Africa it would quite
00:09:29
like be from China as we all know uh our
00:09:32
China this is an issue our Chinese
00:09:34
addition has been following closely is
00:09:37
the volume of Chinese investment in
00:09:39
Africa uh could you help us understand
00:09:43
how you view China's investment strategy
00:09:46
in Africa and what it means for
00:09:48
investors from other parts of the
00:09:50
world um good question I I I don't know
00:09:53
if I can talk too much to the Chinese
00:09:55
investment strategy because I'm not
00:09:57
privy to the Chinese investment strategy
00:10:00
um uh but it to you from from from my
00:10:04
observation from what I see
00:10:07
um uh in the last few years the Chinese
00:10:09
when they first came into the continent
00:10:13
noticeably um about 10 years ago um a
00:10:16
lot of African countries were very
00:10:18
uneasy with the nature and the manner in
00:10:20
which they were coming in and and
00:10:22
setting up uh businesses and uh the
00:10:25
types of Investments that we're making I
00:10:27
think the Chinese have become much more
00:10:30
sophisticated in the last 10 years and I
00:10:32
believe uh that they now actually do
00:10:35
have a strategy again I do not have it I
00:10:37
don't know if they'll make it available
00:10:39
to
00:10:40
anybody uh but the fact of the matter is
00:10:43
there is there appears to be some
00:10:44
strategy uh and it evolves evolves
00:10:47
evolves around uh what they have studied
00:10:51
the continent extremely
00:10:53
well they know what the demographics are
00:10:57
uh there is a rising uh middle class in
00:11:02
uh on the continent uh there's a very
00:11:05
Dynamic young population uh the
00:11:08
continent is becoming increasingly uh
00:11:12
urbanized um and therefore there is a
00:11:15
market and purchasing power on the
00:11:18
continent so that's one so I think part
00:11:20
of one part of the Chinese strategy is
00:11:24
based on the fact that they are reading
00:11:26
Africa very well in terms of where we
00:11:28
are now and where we like to go to in
00:11:30
the next uh few years the second element
00:11:33
of it is that the Chinese
00:11:36
also appreciate the rich the riches that
00:11:40
the continent has uh most other
00:11:44
countries have known the kinds of riches
00:11:47
that exist there um some of them some
00:11:50
foreign countries uh Northern countries
00:11:53
North America Europe uh have tended to
00:11:56
extract from the continent those
00:11:58
Commodities and those those
00:12:00
valuable uh um minerals uh metals that
00:12:05
they needed in order to grow and develop
00:12:07
their Industries uh the Chinese uh I
00:12:10
think have figured out that um over the
00:12:13
next 10 or so years uh some of the most
00:12:16
valuable Commodities uh that the the
00:12:19
global economy requires uh are on the
00:12:22
continent so I think the Chinese are
00:12:24
positioning themselves and and and
00:12:26
looking to do business uh with African
00:12:29
countries the Chinese have figured out
00:12:31
that in another 10 years the continent
00:12:33
will have a population of 1 billion
00:12:35
people that's a very sizable Market
00:12:37
that's a sizable Market uh for selling
00:12:42
uh your products uh sizable uh market
00:12:46
for you know setting up and and and and
00:12:49
not to mention the the human resource
00:12:51
capability that exists there for
00:12:53
producing Goods that you might want to
00:12:55
export into your import into your own uh
00:12:58
into your own country
00:13:00
so again I'm not sure what the strategy
00:13:02
is but I can look and imagine that um
00:13:05
there are things that they're seeing
00:13:06
there that uh that obviously uh are
00:13:09
going to put them in a very good
00:13:11
position um uh in terms of uh who will
00:13:15
benefit and what implications do you
00:13:17
think this will have for investors from
00:13:20
other parts of the world it it it's a
00:13:22
challenge I mean investors are going to
00:13:23
have to compete with somebody who
00:13:25
already has a
00:13:26
foot
00:13:28
uh and the door uh an investor who is
00:13:31
investing heavily in building developing
00:13:34
infrastructure which is where uh African
00:13:37
governments will tell you that's where
00:13:39
the greatest need has been
00:13:41
infrastructure infrastructure
00:13:42
infrastructure and uh if that's where
00:13:44
the Chinese are putting the emphasis and
00:13:47
a good part of this infrastructure is
00:13:48
about opening up the continent and and
00:13:53
so you will be able to you're in a
00:13:55
situation where uh if you are part of
00:13:59
what is going to be going on in the
00:14:00
continent in the next 10 years or so uh
00:14:03
and if this infrastructure has been
00:14:05
developed Africa is going to be able to
00:14:07
trade within itself quite quite
00:14:10
significantly and we've learned this
00:14:11
just in the last 2 three years during
00:14:13
the global recession and this economic
00:14:16
crisis uh when our Commodities didn't
00:14:18
have a ready Market because our buyers
00:14:20
or traditional markets were experiencing
00:14:23
the crisis so we turned Inward and
00:14:26
started trading with each other so the
00:14:27
potential for trading Within continent
00:14:30
with this developed
00:14:32
infrastructure clearly the person who is
00:14:35
investing in the infrastructure
00:14:37
themselves uh will stand to benefit very
00:14:40
significantly because they will
00:14:42
know uh the infrastructure very well and
00:14:45
part of just being a good business
00:14:47
person and investor is knowing how the
00:14:48
infrastructure is uh is set up and how
00:14:52
things move from point A to point B um
00:14:58
so for
