Kenya is back in the business of assembling vehicles after Volkswagen South Africa signed a deal with the Government to assemble vehicles in Thika.
Volkswagen has signed a deal to use the Kenya Vehicle Manufacturers in Thika to assemble its popular models beginning with the Volkswagen Vivo.
The first fully Kenya assembled Vivo is expected to roll out of the Thika plant by December this year.
Making the announcement Wednesday, President Uhuru Kenyatta said the plant will then expand into a fully fledged assembly operation producing a range of vehicle makes.
“I am happy to welcome back the Volkswagen Group, currently the largest car manufacturer in the world, back to Kenya,” said President Kenyatta at State House, Nairobi, where he witnessed the signing of the agreement between Kenya and Volkswagen.
The German automaker used to operate in Kenya in the1960s until 1977 and used to assemble Volkswagen vans, microbuses and the famous Kombi.
President Kenyatta said the return of Volkswagen is a sign of the economic transformation Kenya has undergone. He said the venture will create jobs for many Kenyans.
“This is a milestone in my administration’s determined push to grow the manufacturing base and transform Kenya into an industrialized nation. We are in the early stages of transformation,” said the President.
President Kenyatta said the new development was proof of the success of the four initiatives the Government has focused on to transform Kenya.
The areas of focus include investments in infrastructure including rail, roads and energy.
“This is being welcomed by major investors such as Volkswagen who realize that Kenya is now a more competitive investment destination, and are responding by pursuing opportunities here,” said the President.
The second area of focus is the reforming of the regulatory and business environment under the Ease of Doing Business Programme.
The third area the government has put emphasis on is to grow effective linkages between foreign direct investment and local enterprises
“Whenever I travel out of Kenya, it is always with an eye to making concrete steps to increase investment by showing the world the huge opportunities available here at home,” said the President.
The Head of State said the hosting of major conferences in the country has also allowed a critical mass of global investors to see what Kenya has to offer.
The President said the fourth area the Government has invested in is the improvement of human resources competitiveness
He said attracting world-class companies like Volkswagen provides a lure and anchor to other similar investors.
“When I came to office, I knew that Kenya needed to become a strong bridge for investment, ideas and regional stability if we are to transform into a wealthy middle class economy,” said the President.
The Volkswagen South Africa CEO Thomas Schafer said his company is excited to be back in Kenya.
“We were in Kenya in the 1960 and 70’s and resuming operations here is part of our Africa strategy,” said Schafer.
Schafer said Kenya has a huge potential to be a vehicle exporting country that serves the wider Eastern Africa region.