Category Archives: China

JW Marriott to open hotel in Nairobi with AVIC

Today, Marriott International and AVIC International signed a partnership agreement which will see Marriott operate a 365-room, 5 star J.W Marriott luxury hotel for AVIC in their Africa headquarters and office complex, in Westlands Nairobi .

AVIC representatives said the company had been in Kenya for the 20 years, engaging in four areas; aviation (built the new JKIA airport terminal, and supplied Y12 aircraft), education (equipment and training for NYS projects), real estate (in which they hope to create 15,000 jobs), and CSR (sponsoring Kenyans to get educated in China). AVIC is a China state-owned company with 60 global offices .

Avic Marriott Nairobi signing

A VP from Marriott said that while the have 110 properties (with 13,000 rooms) in Africa, this was the first J.W Marriott in East Africa and  they planned to expand in 5 more countries by 2020 including Rwanda and Zambia. Also that they have 19 global brands, and may open under a different chain in Mombasa, Kenya). He said they have many Kenyans managing and working at their properties in the Middle East, and who were ready to come back home to work . He said that they choose owners and investors carefully to partner with in China and Africa.

Nairobi County Governor Evans Kidero, who was hailed as a supporter of the project, said that the $400 million AVIC complex with JW Marriott hotel represents 6% of Nairobi’s annual new building space and 8% of the annual build cost. He also said that with 5,000 hotel beds, the city is strained when hosting large summits like the upcoming UNCTAD and TICAD 6, which will both be in Nairobi later in 2016.

Construction of the AVIC complex, started in August 2015. It will have 6 towers, with the tallest being 42 storeys. Building works are ongoing, next to the Villa Rosa Kempinski Hotel that has established itself over the last two years and who challenged the construction of the AVIC complex.

5 Intra-African Travel Barriers

There’s a lot of talk about removing intra-African trade barriers. But how about barriers for Africans traveling within Africa? If it’s easier to travel, it will be easier for people to cross borders, see & seek opportunities and build trade & business networks. But what stops more of this from happening? Here are 5 angles.

1. Airline costs: Airline travel is quite expensive, even for very short flights like $350 for the one hour Nairobi-Entebbe flight. This is largely due to national taxes, that form more than 50% of the cost of some tickets.

Costs from Nairobi to various cities, priced by

Costs from Nairobi to various cities, priced by

Kayak nairobi2. Visa restrictions. Nigerian-born Aliko Dangote, who is believed to be the continent’s richest man was recently quoted as saying “I need a visa in almost 38 countries, which means an American has more access into Africa than myself.” Two years ago, tiny Rwanda made a bold move by allowing all African nationals to be issued with visas on arrival in the country, by- passing the embassy application process that is expensive and bureaucratically burdensome to access many countries.

3. Unfriendly Currencies. To travel and trade across Africa, and many parts of the world, the US dollars is crucial, as no African currency gets respect across its borders. You might be able to exchange it in a country that has lower forex restrictions, but at what cost? Looking at the currency spreads in the bank hall today, the differential between buying (Kshs 90) and selling (Kshs 84) the US dollar works out to about 7%, which is also the same for the sterling Pound and the Euro. But for African currencies, such as the  South African Rand (bought at 6.69 and sold at 8.93) , it’s a 28% difference, and for the currencies of Tanzania its 54%, Uganda 93% and Rwanda 96%. Somewhere in-between is Asia, with the UAE Dirham at 17%, Indian Rupee at 15%, and Japanese Yen at 16%.

4. Knowledge Gap: There’s still very little knowledge about the greater Africa beyond their borders by African country nationals. I try to follow at least one current affairs, and preferably business-related, African national on twitter, but there are still many countries that I can’t find people to follow, and learn from. The best news source on Africa I’ve found is AfricaLive, the one-hour daily news nightly programs on China’s CCTV Africa channel.

5. Poor Road networks. If it’s tough to fly, it equally to drive across the continent and cross its many borders with varying degrees of red tape. Today, I saw these quotes by @mmnjug on twitter ” DRC is the world’s eleventh biggest country at over 2.3M sq kMs,and an estimated 73M people, but has only 2,250 kilometres of paved road..,In the past two decades, just two people are recorded to have crossed the DRC over land, their journey took 44 harrowing days in 2008.”

Nairobi’s Future Roads

Last month at the opening of the next phase of the Office Park complex,  Engineer Arasa of the Kenya Ministry of Roads gave a talk on the future of roads in Nairobi  – who’s construction this year will amount to  Kshs. 153 billion (~$1.8 billion) and reach an eventual total spend of Kshs. 2 trillion over the next 15 years. 

Kileleshwa road with a cycle path

The biggest one has been the Nairobi-Thika Highway, financed by the African Development Bank but other roads  are the Eastern bypass (connecting Mombasa Rd to Thika Rd)  and the  Northern bypass (connecting Thika Rd to the Nakuru Highway)  which are being financed by the Chinese Government. There is also the  Southern bypass which is a 28KM dual carriageway road linking Mombasa Road to Kikuyu, that will be constructed at a cost of Kshs. 1.1 billion and is jointly financed by the Kenya and Chinese governments. It will have  3 flyovers (including at community, Thogoto and Dagoretti Roads) and is expected to be complete by July 2015.

There are also the missing link  roads in the west of Nairobi, being financed by the Japanese Government that will connect Ngong Rd to James Gichuru, and Gitanga Rd to Waiyaki Way – both though Kileleshwa –  and both are expected to be completed in March 2013. (Note the bulldozers at the Yaya parking now) 

Others include upgrading  Langata Rd to dual carriageway at Kshs 2.6 billion (with an underpass at Bomas junction) and, and there are also the Upper Hill Roads being done in two phases (Kshs 2 billion, financed by GoK), starting with the widening of Elgon, Kilimanjaro, Upper Hill, and Bunyala Roads to dual carriageway  by May 2014.
Bomas junction in the future

Other planned roads in the future include  converting Adams Arcade – Karen – Ngong – Bomas to four lanes (with flyovers at Dagoretti Corner and Karen shopping centre)  – between 2013 – 2016 to be financed by the Chinese Govt at an estimated cost of Kshs 15 billion. Another will convert Outer Ring Rd to dual carriageway (at a cost of Kshs 6 billion, of which 3.5 billion has been sourced from ADB) .

Some interesting point in the talk were:
  • Though stats show that 47% of Nairobians walk to work, the Roads Ministry hopes the new roads will address several challenges such as unregulated public transportation, encroachment on road reserves, (past) low investment in roads, inefficient junctions and the already present traffic. They also know that more & better roads may result in more traffic e.g. Thika Road which used to handle 70,000 vehicles per day, will have 100,000 per day by the end of the year.
  • Thika Road will be a toll road.
  • Another missing link road may include a fly over at the City Mortuary junction.

Are Kenyan Engineers Capable of Building Thika Road?

Yesterday’s post at the Thika Road Blog sparked a response from @BridgeMkr

Having grown up in Kenya then gone to the US for college and worked there ever since in bridge design, I would say that the Kenyan education system was more than adequate in preparing me for engineering school and a career as bridge engineer.

Based on that, I would say that the civil engineering graduates from Kenyan Universities have the basic tools to succeed as engineers in this world.

I read a comment that Kenyan universities are preparing students for 1980’s style construction – and if that is true, then I would say that is a good thing. If one clearly understands how to design structures built in the 1980’s then they understand the basics of design and construction.

There are buildings and bridges built in the 1900’s that are still standing. Over the years, the basics in design & construction have remained the same, with the difference being how well/accurately we calculate the design loads, and how well we design the structure to withstand these loads, the safety factors we apply to them, and the materials we use to construct them. If one understands the basic principles, then the next step of understanding modern design factors, codes, and materials is very simple.

I would rather have an engineer that can design a bridge using the old code by hand, than one who can only design the bridge using modern software packages, (and who does not know how the program comes up with the solution).

China has over a billion people therefore they will have way more engineering graduates. The way forward for Kenya and Africa, is to continue to produce civil engineers who clearly understand the basics in design and construction. Some of these graduates can then go to universities aboard to get their masters and post-graduate degrees, and who can later transfer this additional knowledge back to Kenya and Africa. The graduates that remain in Kenya upon graduation should go work under the direction of more qualified engineers, who can give them guidance on how to design various basic structures at first, with the complexity of the structure increasing as their career progresses. In engineering, like most things, experience, with the ability to learn, counts the most. Those graduates that went abroad, on return to Kenya can start out designing more complex structures based on the experience gained, but should still work under the guidance of more experienced engineers.

It may surprise a few people but today in the US, there is a debate raging on whether a master’s degree in civil engineering should be the minimum qualification for someone to be a registered civil engineer. It is felt that the current undergraduate programs are not adequate, especially if the pay for civil engineers is to go up.

In order for Kenyan and African engineers and companies to compete for, and design, major construction projects like the Thika Road Project, there needs to be a requirement that Kenyan and African engineers and companies be involved in the design and construction of these projects. This can be done by requiring some portions of the project to be designed and constructed by local engineers.

Another requirement, which would add to the cost of projects, but would ensure the transfer of knowledge, is to have independent designs done by local engineers. This means, having Chinese /European/American design firms design the complex structures but at the same time have local engineers and companies independently produce designs of the same complex structure. The local firm’s designs can then the compared to those produced by the foreign firm. Another problem with design & construction in Kenya and Africa is having adequate QA/QC procedures in place to ensure that structures are designed correctly and constructed according to the engineers design using the specified materials.

Through this process, current local deficiencies (if any) would be revealed, and at the same time the local firms would learn how things are done differently by foreign engineers/firms. This design exercise cost is very small, compared to the actual construction costs and I have been involved in projects where two independent designs have been produced.