The Major Kenya-US Agreement That Could Keep Billions at Home
Kenya is closing in on a major deal with the United States that will dramatically change for the better how the country makes the most of its mineral wealth, with President William Ruto saying that the proposed partnership will make a 180 degree turn on exporting those valuable resources as raw materials and instead see them get processed right here in Kenya.
Talking during the G7 Summit in Evian-les-Bains, France, President Ruto said that the negotiations with the US administration under President Donald Trump are getting down to the wire, with both governments managing to find common ground on the big ticket items of the deal.
Kenya Eyes Greater Value From Critical Minerals
At the heart of this proposed agreement is a commitment to making sure Kenya gets a better deal from its valuable minerals by doing more of the processing work here at home – specifically for rare earth and other critical minerals.
The president pointed out that this arrangement marks a big shift from the more usual resource deals that’ve seen African countries exporting raw materials while the actual manufacturing and processing happens elsewhere.
“We’re in the final stages of sorting out an agreement with America over some of our most valuable minerals – the rare earth and critical minerals. And here’s the thing, we’ve actually agreed that the minerals are going to get processed in Kenya, rather than the usual scenario where we just export them and let someone else do the work.” Ruto said.
He also mentioned that the key thing is the deal has come out of the talks and both governments are pretty happy with it.
“Weve reached an agreement that benefits both Kenya and the United States – and the US President Trump and the US administration are pretty chuffed with it,” he said.
Why the Deal Could Matter for Kenya
Rare earth minerals and other strategic resources are becoming more valuable by the day as countries plough more money into electric vehicles, renewable energy and advanced manufacturing.
Kenya is thought to have got some pretty valuable minerals stashed away – things like rare earth elements, lithium, graphite, niobium, copper and nickel. Most of these resources are still pretty much untouched, so there’s some real potential for the future when it comes to investment and growth.
By processing its minerals here at home, Kenya hopes to create new jobs, give its manufacturing a bit of a boost and – most importantly – get a bigger share of the profits from the sale of its natural resources.
Africa Shifting Away From Raw Resource Exports
Ruto pointed out the proposed deal is a step in line with a more general trend in the continent, where governments are increasingly insisting that natural resources aren’t just there to be sold off to foreign companies, but rather they should be used to kickstart some real domestic industry and job creation.
Drawing on the experiences of other African nations – like the Democratic Republic of Congo, for example – he was saying that on the whole, African countries need to move away from simply exporting raw materials and start building up industries that can create work and a lasting economic impact.
Ruto Calls for Investment, Not Extraction
As well as this minerals deal, though, Ruto used the G7 Summit to get across to Western countries that they need to change how they do business with Africa.
Rather than all these aid deals and resource extraction arrangements that go on in Africa, the continent is looking for partnerships that are about investing in the place, building up its industries and sharing the economic benefits around.
“We’re not going to be interested in any relationship that’s just based on taking our natural resources, our energy resources, our people off us. We want to build relationships with countries who are interested in actually investing in our continent”, Ruto said
He said that Africa still wants to work with countries like the US, China and Europe, but the decisions Africa makes are going to be based on the priorities for its own development, not on trying to get caught up in the geopolitics.
Appeal for Easier Access to Development Financing
Ruto also asked G7 leaders to back changes that would make it easier for African countries to get at the funding they need.
The problem, he said, isn’t that Africa doesn’t have enough money to do the things it needs to do, its that they just can’t get hold of the finance that is available to them. He reckons that broadening out the package of guarantees and shared risk arrangements could unlock all sorts of cash thats just sitting around in African pension funds, insurance assets and financial reserves – and at the same time make borrowing more affordable for governments and businesses.
The whole thing shows up Kenya’s broader drive to get into partnerships that can drive investment, industrialisation and sustainable economic growth in Africa – and to have a bit more control over the continent’s resources.
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The Major Kenya-US Agreement That Could Keep Billions at Home
