The Star (Nairobi)

Kenya: World Bank's Road Funds Hits Sh90 Billion

The new credit agreement signed on Wednesday has now pushed World Bank-supported portfolio in Kenya's transport sector to $1.06 billion (Sh90.1 billion). The $300 million (Sh25.5 billion) loan agreement for the National Urban Transport Improvement Project adds to $460 million (Sh39.1 billion) for the Northern Corridor upgrade project, and $300 million (Sh25.5 billion) for the Transport Sector Support project for upgrade of Kisumu International Airport and JKIA.

The bank now wants the implementing agencies to fast-track the realisation of these projects while sticking to timelines. "It is important for these projects to be implemented in time to avoid cost overruns, and also to ensure that they deliver the envisaged benefits," said Johannes Zutt, the bank's country director for Kenya.

The new project, which is behind schedule by five years, should start right away, according to Finance minister Njeru Githae. Completion of NUTRIP is expected to make the roads predictable. "It should have been completed at the same time as Thika Superhighway," Githae said.

The World Bank is strict on timelines and may withdraw funds if the project delays, according to Githae. "The issue of 'ineligible expenses' in donor-funded programmes arises when terms and conditions of financing are not followed." He said the loan has taken the shortest time to negotiate and has been issued at concessionary terms of 0.5 per cent per annum, with a 10-year grace period. It will be repaid in 30 years.

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