Kenya: CS opposes contractor’s funding plan for expressway

Transport Cabinet Secretary James Macharia. FILE PHOTO | NMG 

By LYNET IGADWAH

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Summary

• American contractor Bechtel is lobbying Kenyan authorities to choose the model where government pays a contractor for the road construction in what will force the government to borrow the billions, jerking public debt whose rapid growth has triggered warnings.
• The American government nominated United States construction giant Bechtel Corporation to be considered to develop the project.
• The company has been working with the Kenya National Highways Authority (KeNHA) to design the new six-lane road.

The Ministry of Transport prefers a private-public partnership for construction of the planned Nairobi-Mombasa expressway whose cost is estimated at Sh380 billion against the wishes of an American contractor.

Transport secretary James Macharia told Parliament the technical aspect of the project has been agreed on but the financing agreements are yet to be concluded.

American contractor Bechtel is lobbying Kenyan authorities to choose the model where government pays a contractor for the road construction in what will force the government to borrow the billions, jerking public debt whose rapid growth has triggered warnings.

It argues that the alternative PPP model where the contractor sources for funds would cost five times more at $15 billion (Sh1.5 trillion) and take much longer to complete.

“As of now it may be a bit pre-mature to go into too much detail because we have not narrowed down to say if it is PPP or borrowing. Although our preference is to do PPP,” Mr Macharia told the National Assembly committee on Transport

He said feasibility studies on the 473-kiometre road are on-going with land compensation costs expected to hit Sh30 billion.

The idea to build Nairobi-Mombasa expressway dates back to the July 2015, when then American President Barack Obama signed a Memoramdum of Understanding with the Kenyan government.

READ: US company lobbies Kenya for Sh300bn road contract

The American government nominated United States construction giant Bechtel Corporation to be considered to develop the project. The company has been working with the Kenya National Highways Authority (KeNHA) to design the new six-lane road.

Motorists are expected to cruise uninterrupted on the highway at speeds of up to 120km per hour, halving travel time to four hours.

They will however pay toll charges for the luxury of cruising through the route that is currently characterised by heavy congestion and slow speeds.

The road whose construction is set to commence in July 2018 will have interchanges to connect to the standard gauge railway and existing roads, along with 76 overpasses and 21 underpasses.