Germany Calls for Security and Stability to Boost FDI Into Africa
Only 1% of German FDI or a little above EUR 10 billion currently goes to Africa, but that might soon change. Of all the regions worldwide, the African continent is set to register the highest economic growth behind Asia. The trade volume between Germany and Africa reached a record ERU 61.2 billion in 2023 with German exports to Africa reaching EUR 28.7 billion while imports from Africa making up EUR 32.5 billion.
German Vice-Chancellor and Economy Minister Robert Herbek and Kenyan Prime Minister and Foreign Affairs Minister Musalia Mudavadi jointly opened the German-African Business Summit (#GABS2024) at the Radisson Blu in Nairobi on 2 December 2024. This bi-yearly 5th edition coincided with the 60th anniversary of diplomatic ties between Germany and Kenya and took place in Nairobi from 2 to 4 December 2024.
Some 800 delegates from 35 African countries and Germany attended the Summit held at the Radisson Blu Hotel in Upper Hill, Nairobi. In addition to high-level government officials, most of the attendees were from the business community and civil society.
PM Mudavadi highlighted that the African continent offers immense potential in sectors such as agriculture, energy, infrastructure, manufacturing and technology. Mudavadi noted with pleasure that German companies have invested in renewable energy, automotive manufacturing and infrastructure projects in Kenya.
“But to harness this potential, we need strong partnerships through events like the German-African Business Forum. The summit comes at a time when, as a country, we are celebrating 60 years of our diplomatic journey. At this period, we remember that Germany was the first country in the world to recognize Kenya as an independent country”
Kenyan PM Musalia Mudavadi
Kenya is positioning itself as the Gateway to East Africa and the broader African market as depicted in its Vision 2030 National Development Plan (#NDP). In the future, PM Mudavadi proposed to expand the economic partnership to better address #ClimateChange, #FoodSecurity and #EnergySovereignty that the continent is facing.
German Minister Herbek highlighted that in 2023 alone, 930 German companies have invested in Africa and created some 230,000 jobs. Every year, nearly one million of young Kenyans come into the labor market. It is worth recalling that Germany and Kenya signed a skilled labor and migration deal in September 2024.
One of the undeniable German success stories in Africa is the case of Volkswagen. Over the years, Volkswagen has steadily expanded its production capacity across the continent. In sub-Saharan Africa, Volkswagen has assembly plants in Kenya, Rwanda, South Africa, Nigeria and Ghana.
As an interesting development, Germany now welcomes circular migration of skilled workers from Kenya whereby young people come to work in Germany for a few years and then return to Kenya. This bi-directional flow will facilitate transfer of knowledge and lay the foundation for the upgrade and long-term sustainable development of the Kenyan economy.