Germany urges more investments in Africa

Germany’s Development Minister Gerd Müller has called for more German engagement in Africa at the just concluded 2nd German-African Business Summit  in Nairobi. He argues that investments help reduce poverty. Daniel Pelz reports.

Dr Gerd Müller does not hesitate. With a huge smile, the minister picks a white coat and heads to the manufacturing hall of Kevian, a leading Kenyan juice maker. He first admires the flashy filling stations and watches keenly as the juice bottles move on the conveyor belt. “Great!” he calls out to the employees.

Shortly afterwards, he lifts up a carton full of bottles like a winners’ cup. Kevian’s founder Richard Rugendo can hardly manage to keep up with the eager guest from Germany. The hall is humid; the first beads of sweat are already forming on the boss’s brow.

Kevian is a showcase project. The filling plants were supplied by a German company and financed by a loan from development agencies in Germany. The company has grown from 60 employees to 600. The fruit suppliers also benefit.

“That’s how it should be. 300,000 farmers supply mangos for processing. The farmers have long-term contracts, get a fixed price and can live on it,” Müller said. According to the 61-year-old minister, Africa needs ten thousand of such factories.

Marketing ‘Africa’s Marshall Plan’

For Müller, the Kevian drinks company is a good example of his message which he has repeated during this trip. “Africa needs investments which can create jobs.”

It is also one of the core messages of Germany’s “Marshall Plan with Africa”. During his trip to Africa, he presented for the first time this concept for a new co-operation between Africa and Europe at the German-African economic summit in Nairobi. In Berlin, the 32-page document was received with reservations. It is still unclear what can be realized because the development minister cannot implement many of the proposals as they do not fall within his area of ​​competence.

Germany’s economic interest in Kenya is relatively low. Kevian is an exception. Just 1.6 percent of Kenyan goods made their way to Germany in 2013. On the other hand, Germany exported goods worth 2.6 per cent to the East African country. Only about 70 German companies are presently operating in Kenya.

Open for business

CEO Rugendo hopes that this will soon change. He is one of the participants in the German-African Business Summit which ended on Friday (10 February) in Nairobi. “There are many sectors with room for investment. We have a free economy and we want everyone to have a job. So we need more investors,” Rugendo told DW.

Germany’s minister Müller seems to have found an ally in Rugendo. He is convinced of the need to strongly involve the private sector. “The government can only create the right environment for a functioning economy. But the private sector can create jobs or finance the state through taxes and get the economy running,” Rugendo said.

Corruption an obstacle

Minister Gerd Müller told DW that Africa should strive to create a favorable environment for conducting business by getting rid of corruption. “We need to see progress made on anti-corruption and legal certainty has to be created for companies,” Müller said.

Following the business summit, expectations are high for Dennis Awori, chairman of the Kenya Private Sector Alliance and vice-chairman of the East African Business Council, “They include the establishing of partnerships between East African companies and German companies in the area of setting up value additions for some of our products,” Awori said.

Gerd Müller is on the go again. He plans to visit two more companies. As he leaves, he hands out several scholarships to a group of Kenyan youths for a vocational training. With such dedication, it seems as if the minister would personally ensure that the German investors develop a similar passion for Africa like himself.

Deutsche Welle

Andrew Wasike contributed to this article