The government has suspended the construction of the Mombasa-Nairobi expressway after Kenya hit its debt ceiling. The 485 Kilometer highway will wait another two years as Kenya addresses its debt problem, now at KSh 5.9 trillion. The project, contract awarded to Bechtel would have been Kenya’s largest single contract road project.
According to Transport CS James Macharia, the country is holding the Mombasa-Nairobi project off to allow debt levels to drop. Meanwhile, the ministry will prioritize other projects like the Nairobi-Nakuru-Kapbsabet and the JKIA-Westlands Expressway.
The announcement comes after the US Ambassador expressed his concerns about Kenya’s debt levels and therefore suspended the project. According to the government, representative ethics and transparency demand that Kenya address its ballooning debt problem.
“Bechtel and the US government have remained fully engaged with Kenya, and we continue to follow up on President Trump’s and President Kenyatta’s commitment to make the project a reality. But Kenya’s debt is spiraling out of control. We don’t want to pile up more debt on Kenyans. We want to do business transparently and ethically. Therefore, the onus is on Kenya to put its debts in order.”
Ambassador Kyle Carter, in an interview with Nation.
Earlier, an American envoy had expressed concerns over inflation of the cost of the project. The Star reveals that KeNHA inflated the cost from an original $ 1.8 billion to $ 3 billion. The 66.7% inflation is part of the reason why the US government is halting the project.
Value for Taxpayers Money
Holding off the Mombasa-Nairobi project will allow Kenyans to explore other options like Public-Private Partnerships in completing the project. Macharia believes that postponing the construction will enable Kenya to gauge the success of other PPPs, before constructing the highway.
At the same time, the road deferred will allow taxpayers to obtain value for their money, currently an elusive affair. Kenya’s public debt stands at KSh 5.902 trillion, so close to the KSh 6 trillion threshold. At the beginning of this month, the domestic debt stood at KSh 2.836 trillion whereas external debt hit KSh 3.066 trillion.
Bechtel and the US government have remained fully engaged with Kenya and we continue to follow up on President Trump’s and President Kenyatta’s commitment to make the project a reality. But Kenya’s debt is spiralling out of control. We don’t want to pile up more debt on Kenyans. We want to do business in a transparent and ethical way and the onus is on Kenya to put its debts in order.
Ambassador Kyle Carter in an interview with Nation.
Holding off the project will allow the Govt to explore other options like Public-Private Partnerships in completing the project. Transport minister Macharia believes that postponing the project will allow Kenya to gauge the success of other PPPs, before constructing the highway.
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