Existing work on China’s economic influence in Africa
refers to Africa in broad terms, thereby generalizing the
results to an extent that is unhelpful for policy-makers
in a specific country. Moreover, the emphasis is on oil
exporters. This paper remedies this by focusing on a single,
oil-importing country: Kenya. The paper examines China’s
economic presence in Kenya and some of the popular myths
surrounding Chinese economic activity. The first myth
is that Chinese companies do not employ local workers.
In fact, 78 percent of full-time and 95 percent of parttime
employees in Chinese companies are locals. Second,
although China represents a large potential market for local
exporters, the study finds that China has a better chance of
expanding its exports to Kenya than Kenya does to China
based on existing specializations. This may change with
recent oil discoveries in Kenya, increasing the space for
Kenyan exports to China, as well as from China’s shift to a
consumption-driven economy which will increase demand
for services, a growing strength of Kenya’s economy (World
Bank Country Economic Memorandum 2016). The
paper emphasizes that Kenyan policy makers should be
less concerned about bilateral trade imbalances and worry
about Kenya’s overall trade balance. However, the Standard
Gauge Railway and Thika superhighway experiences
suggest that Chinese firms offer relatively few technology
transfer or supplier opportunities for local firms and academia.
Third, the popular focus of Chinese competition
is on the impact on well-organized Kenyan producers and
not on consumers, thereby underestimating the benefits
Kenyan consumer derive from the availability of more
affordable Chinese goods. The paper concludes with
policy directions for improving export competitiveness and
transparency in infrastructure projects, and local content.