The government has signed a US$ 150 million (Ksh 16.38 billion) financing agreement with United Bank for Africa (UBA) as part of a landmark US$ 1.35 billion (KSh 175bn) programme to clear unpaid road construction bills and revive stalled projects, marking one of the country’s boldest experiments with securitization.
- •UBA Kenya, a subsidiary of Lagos-based UBA Group, is among the largest financiers in the deal, which channels a portion of the country’s Road Maintenance Levy into a special purpose vehicle to raise funds upfront for contractors.
- •UBA executives said the investment reflects confidence in Kenya’s long-term growth and the strategic importance of infrastructure.
- •The KSh 175Bn in pending bills shortfall has frozen more than 580 road projects across the country.
“Infrastructure and SMEs are interconnected—one builds the roads, the other drives the economy on them. At UBA, we are financing both sides of that equation,” Oliver Alawuba, UBA Group CEO, said.
Roads and Transport Cabinet Secretary Davis Chirchir defended the securitisation model in July, describing it as a transparent, legally compliant alternative to borrowing.
“This model allows us to pay contractors promptly, revive suspended projects, and bring lasting relief to communities—all without adding to Kenya’s debt burden,” Chirchir said at the time.
Under the plan, Sh7 from the existing Sh25 per litre fuel levy is assigned to a special purpose vehicle, which then securitizes future collections to raise immediate cash. The Cabinet Secretary said the Kenya Roads Board has no further liabilities once the rights are sold.
Kenya’s adoption of securitization underscores a growing shift among African governments towards leveraging predictable revenue streams to finance infrastructure while containing public debt.