NAIROBI, Kenya- President William Ruto has announced that construction of a $16 billion, approximately Sh2 trillion, oil refinery in Lamu is expected to begin next week.
President Ruto said the proposed East Africa refinery will have the capacity to process 700,000 barrels of oil daily, positioning Kenya as a major petroleum-processing hub serving continental and international markets.
“In one week, we expect to break ground on the East Africa refinery in Lamu, capable of processing 700,000 barrels of oil a day,” he said.
The President made the announcement during Kenya’s national address at the 81st United Nations General Assembly in New York on Wednesday.
He presented the refinery as part of Kenya’s plan to move away from exporting raw materials and build industries that process resources locally, create jobs and supply finished products to African markets.
“It represents the Africa we seek to build: adding value at home, creating jobs for our people, and building industries capable of serving continental and global markets,” President Ruto said.
The Head of State did not identify the project’s investors, expected construction period or sources of crude oil for the refinery.
Details on financing, ownership, environmental approvals and the precise location of the facility were also not disclosed in his address.
At its proposed capacity, the refinery would rank among the largest petroleum-processing facilities in Africa.
Africa Must Stop Exporting Raw Materials
President Ruto told world leaders that Africa’s natural resources must support the continent’s industrialisation instead of continuing a historical pattern in which raw materials are exported and finished goods imported at higher prices.
“Africa’s resources must become the beginning of African industry, not the end of Africa’s contribution to the value chain,” he said.
He argued that the continent’s transition from extraction to manufacturing was already emerging in cocoa, textiles, clean energy and other industries.
The President said the African Continental Free Trade Area should become a platform for producing more of the goods Africa currently imports rather than simply serving as a larger market for existing products.
He proposed mobilising part of the more than $4 trillion held by African pension funds, banks, insurers, sovereign wealth funds and other institutions to finance infrastructure and industrial projects.
Ruto Targets High Borrowing Costs
President Ruto also renewed his criticism of the international financial system, saying developing countries were being forced to borrow at interest rates two to four times higher than those charged to developed economies.
He cited United Nations Development Programme estimates showing that subjective credit ratings had cost African countries approximately $75 billion through excessive interest charges and lost lending opportunities.
“Capital must price risk; it must not price prejudice,” President Ruto said.
He called on multilateral development banks to provide larger and longer-term loans while expanding guarantees, local-currency financing and risk-sharing instruments.
The President acknowledged that African governments must also manage debt responsibly, fight corruption, honour contracts and develop credible projects capable of attracting investment.
Kenya Touts Education Spending
President Ruto said Kenya had spent an additional $5.3 billion, about Sh685 billion, on education over the past four years.
He said the government had recruited 100,000 teachers, constructed more than 23,000 classrooms and was developing 1,600 laboratories while increasing support for universities and technical institutions.
The President linked education financing to the global debt crisis, warning that 46 developing countries were now spending more on interest payments than on either health or education.
He also renewed Africa’s demand for permanent representation on the UN Security Council, saying the continent’s 54 countries remained excluded from the institution’s most powerful decision-making body.
President Ruto said reforms must give Africa equitable and permanent representation with all the rights and privileges enjoyed by the council’s current permanent members.
