Kenya Joins Other Oil Exporters In Africa

ECONOMY

Many were not surprised that the International Monetary Fund (IMF) predicted that the Kenyan economy will grow 6.0% by 2020, although they do not know what is behind the latest estimates.

Economists say Kenya is developing very fast with a well diversified economy that does not depend on commodities or a single sector. They have grown rapidly in recent years, although other parts continue to see poverty as a challenge.

However, the government of Kenya is also being  criticized for not eliminating corruption. Kenya has joined the ranks of Africa's petroleum-exporting countries by shipping 250,000 barrels for 12 million US dollars to ChemChina.

This agreement, which was signed in August 2019 was part of a pilot project between the Kenyan government and partner companies Africa Oil Corp, British oil explorer Tullow Oil and France Total SA. This deal according to experts will not end, because Kenya's local raw materials are considered the highest grade-- they are sweet and light, low in sulfur and solid. These features make it a higher market price.

One partner, Tullow, estimates that Kenya's Turkana reserves contain 560 million barrels of oil. Getting the full production potential of an estimated 100,000 barrels per day by 2024, of course, requires investment in infrastructure. Kenya discovered commercial oil in the Lokichar valley in the Turkana region in the northeast of the country in 2012.

Besides Kenya, Gabon, South Africa, Equatorial Guinea, Angola, Nigeria, Congo-Brazzaville, Egypt, Libya, Sudan, South and Sudan are oil-rich countries already in the game on the African continent.

                                The export begins

For some denizens of Kenyan, perhaps it's not the time to be in a jubilant mood after joining other oil exporters across the continent. They believe that they need to learn more about oil exports, especially from developed oil countries.

Meanwhile, Kenyan civil society activists have also questioned the secrecy of the Early Oil Pilot Scheme, which listed oil storage from oil wells and the cost of producing 2,000 barrels of oil per day for two years, including agreements signed with partners.

Over the past twenty (20) years, China's development banks have lent billions of dollars to oil-producing countries in Africa when other funding sources were scarce or non-existent. As a result, China has become the region's largest lender, contributing 14% of total sub-Saharan African debt in 2018.

However, some aspects of China's relations with African countries have raised concerns about the lack of transparency and accountability in the international community. African countries with a history of endemic corruption can welcome Chinese investment in the short run, but can become unstable in the long run due to social problems such as worsening income inequality.