In a landmark gathering on May 9, 2025, President William Ruto of Kenya hosted H.H. Sheikh Abdullah bin Zayed Al Nahyan, Deputy Prime Minister and Minister of Foreign Affairs of the United Arab Emirates (UAE), in Nairobi. The two leaders reaffirmed a relationship that stretches back decades—hatched in historic trade caravans and bolstered by modern investments—and elevated it by witnessing the signing of seven Memoranda of Understanding (MoUs) and cooperation pacts across defence, transport, economic development, customs, energy and private‑sector engagement.

This flurry of accords comes on the heels of January’s Comprehensive Economic Partnership Agreement (CEPA), the first such deal between a Gulf Cooperation Council state and a mainland African nation. Under CEPA, tariffs were eliminated on more than 99 percent of traded goods, and non‑oil bilateral trade surged 26.4 percent to $3.1 billion in 2023, propelling the UAE to become Kenya’s sixth‑largest export market and second‑largest source of imports Reuters. By weaving these new MoUs into the CEPA framework, both capitals aim to channel preferential trade access into tangible projects, job creation and sustainable growth for their peoples.

From the outset, Sheikh Abdullah conveyed warm greetings from UAE President Sheikh Mohamed bin Zayed Al Nahyan, Prime Minister Sheikh Mohammed bin Rashid Al Maktoum and Vice President Sheikh Mansour bin Zayed Al Nahyan, underlining the highest level of commitment to strengthening ties. President Ruto reciprocated, sending his best wishes to the UAE leadership and highlighting Kenya’s own rapid economic transformation since 2013, which has seen average annual GDP growth of 5.5 percent and significant strides in digital finance, agriculture and infrastructure.

Defence Cooperation: Safeguarding Shared Maritime Routes

The first MoU, on military cooperation, signals a deepening of security ties. Signed by Sheikh Shakhboot bin Nahyan Al Nahyan, UAE Minister of State, and Roselinda Soipan Tuya, Kenya’s Defence Cabinet Secretary, the agreement encompasses joint exercises, training exchanges and technology transfers. It places special emphasis on maritime security in the Western Indian Ocean—a corridor vital for both countries’ trade and energy shipments. With piracy threats off the East African coast and geo‑political tensions in the Red Sea, combined naval drills and coordination will improve interdiction capabilities, vessel tracking and information‑sharing between the Kenyan Navy and UAE naval assets.

Transport Collaboration: From Highways to High‑Speed Rails

Kenya’s Roads and Transport Ministry and the UAE’s transport authorities, represented by Davis Chirchir and Sheikh Shakhboot respectively, signed an MoU to collaborate on highway upgrades, intelligent‑transport systems and urban‑mobility solutions. This dovetails with a parallel agreement between Etihad Rail and Kenya Railways—endorsed by Etihad Rail CEO Shadi Malak and Kenya Railways MD Philip J. Mainga—to share expertise on signalling technologies, predictive‑maintenance sensors and feasibility studies for new corridors.

Kenya’s Standard Gauge Railway (SGR), currently extending from Mombasa to Naivasha, stands poised for further expansion toward Uganda and South Sudan. After China suspended funding in 2019, Nairobi turned to Abu Dhabi for fresh backing; President Ruto confirmed in January 2025 that talks with the UAE for financing the remaining 468 kilometres were underway, reviving hopes of a seamless regional rail network Reuters. By integrating UAE know‑how from its 1,200 km national rail system, Kenya aims to cut logistics times, lower transport costs and unlock mineral‑export corridors through the proposed Lobito Transport Corridor.

Economic Development Framework: Catalysing Private Investment

A Bilateral Framework Agreement on Economic Development, inked by CPA John Mbadi of Kenya’s National Treasury and Sheikh Shakhboot bin Nahyan, establishes a joint high‑level committee to pinpoint priority sectors—agribusiness, manufacturing, digital finance, tourism and healthcare. The pact envisages co‑financing vehicles, joint investment roadshows and technical assistance workshops. Reflecting the UAE’s $5.23 trillion foreign‑trade platform and Kenya’s role as East Africa’s financial hub, the framework targets a first wave of $500 million in co-investments by year‑end, leveraging ADQ’s newly formed $500 million finance and investment framework for Kenyan priority sectors ADQ – Homepage.

Customs Cooperation: Streamlining AfCFTA‑Ready Trade

Under the Agreement on Mutual Administrative Assistance in Customs Matters, the Kenya Revenue Authority (KRA) and UAE Customs will implement real‑time risk‑management data exchanges and harmonise electronic single‑window systems to slash clearance times. Currently, importers at Mombasa Port endure an average eight‑day dwell time; by aligning tariff classifications and sharing enforcement best practices, both countries expect to cut this by up to 30 percent, bolstering opportunities under the African Continental Free Trade Area (AfCFTA) and the UAE’s free‑zone network.

Joint Business Council: Forging Private‑Sector Linkages

To give the private sector a direct conduit for collaboration, the UAE Federation of Chambers of Commerce and Industry and the Kenya National Chamber of Commerce and Industry agreed to establish the UAE‑Kenya Joint Business Council. Chaired by senior business leaders, the Council will convene annual forums, sector‑specific trade missions and digital matchmaking platforms. Its inaugural meeting, slated for Abu Dhabi in Q3 2025, aims to catalyse at least $250 million in trade and investment deals within 12 months.

Energy Cooperation: Powering a Greener Future

Energy topped the agenda in two closely related MoUs. Dr. Salem Ibrahim Al Naqbi, UAE Ambassador to Kenya, and Kenya’s Principal Secretary for Energy and Petroleum, Alex Kamau Wachira, formalised cooperation on renewable‑energy projects, grid modernisation pilots and regulatory best practice sharing. Kenya has already attracted Masdar to co-develop the 35 MW Menengai geothermal plant in Nakuru County; under the new agreement, Masdar and local utility partners will explore additional projects in Suswa—a field with estimated capacity up to 500 MW under a $1.2 billion Pertamina‑Masdar collaboration launched in December 2023 at COP28 in Dubai Corporate NTU. This dovetails with the broader Africa Green Industrialisation Initiative, where Kenya secured over $4 billion in geothermal deals, underscoring the country’s ambition to anchor its energy mix in reliable baseload renewables.

Simultaneously, UAE‑based Abu Dhabi’s sovereign fund ADQ reaffirmed its up‑to‑$500 million financing framework via a separate MoU, targeting both greenfield and brownfield energy investments—from grid‑scale solar and wind to battery storage and transmission upgrades. Together, these accords aim to accelerate Kenya’s transition away from expensive diesel generators, reduce electricity costs for manufacturers and support universal access goals.

Geopolitical and Economic Implications

The breadth of these agreements reflects a strategic convergence. The UAE, seeking to diversify its economy beyond hydrocarbons and deepen ties with Africa, views Kenya as a gateway into the East African Community (EAC) and the 1.3 billion‑strong AfCFTA market. Conversely, Kenya, intent on closing an $181–$221 billion infrastructure financing gap and meeting Sustainable Development Goals, gains access to low‑cost capital, advanced technologies and an investor network spanning six continents .

Critically, the MoUs also embed governance safeguards. A joint secretariat in Nairobi will monitor progress against key performance indicators—tenders awarded, pilots launched, jobs created—and publish quarterly dashboards. Civil‑society observers will participate in transport, energy and customs working groups to ensure transparency, procurement integrity and social‑impact leverage.

Challenges and Risk Mitigation

While momentum runs high, implementation hurdles remain. Regulatory divergence, currency volatility and bureaucratic red tape could slow project delivery. To mitigate these, the economic framework provides for partial credit guarantees via the Kenya‑UAE Infrastructure Financing Company, technical‑assistance grants from Afreximbank and targeted risk‑sharing through blended‑finance structures. Moreover, both governments have pledged to streamline approvals under unified investment codes modelled on international best practice.

Human Impact: Empowering Communities

Beyond macroeconomic gains, the agreements promise tangible benefits at the grassroots. Through targeted energy and transport projects, an estimated 200 rural schools will gain solar‑powered mini‑grids; 5,000 youth will receive training in railway engineering and port logistics; and 10,000 women entrepreneurs will access export markets via digital platforms and Joint Business Council networks. These initiatives echo President Ruto’s “bottom‑up” economic vision, which aims to empower ordinary Kenyans and reduce poverty through vocational training and micro‑enterprise support.

Tourism and People‑to‑People Bridges

Though not formalised as an MoU, visa facilitation underpins the relationship. Beginning January 2024, Kenya adopted an electronic travel‑authorization system, waiving visa requirements for all visitors—a move that spurred a 20 percent jump in UAE leisure and business arrivals to 35,000 in 2024. Emirates Airlines and flydubai responded by adding direct flights to Nairobi, enhancing cultural and commercial exchanges Condé Nast Traveler.

Looking Ahead: Implementation and Evaluation

With the memoranda signed, both capitals now shift to execution. The first ministerial review is slated for July 2025 in Abu Dhabi, where deliverables in rail financing, customs‑single‑windows and renewable‑energy tenders will be assessed. Technical committees convene in Nairobi in Q4 2025 to issue calls for proposals, mobilise co‑financing and launch pilot schemes. Progress dashboards will be publicly released, fostering accountability and inviting course‑corrections where needed.

A Blueprint for South–South Cooperation

Ultimately, the UAE‑Kenya partnership exemplifies 21st‑century South–South collaboration: combining the UAE’s capital markets, technological expertise and global trade reach with Kenya’s strategic location, vibrant private sector and ambitious development agenda. By aligning diplomatic goodwill, private‑sector dynamism and multilateral support—through AfCFTA, Afreximbank and the IMF—this alliance charts a pragmatic path to shared prosperity, resilience and regional integration. As Sheikh Abdullah and President Ruto declared, their nations stand not merely as partners, but as co‑architects of Africa’s future.

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photo source: Google

By: Montel Kamau

Serrari Financial Analyst

9th May, 2025