14 February 2013

Kenya: Private Firms to Fund Nairobi-Mombasa Dual Carriageway

A Kenyan company and an Indian group have expressed interest to finance the Nairobi-Mombasa dual carriage way, Finance minister Njeru Githae said on Tuesday.

He said the two have started negotiations for the project and are willing to fully fund the 400km road and plan to recoup the cost through charging of toll fees.

This will be implemented under the Private-Public Partnership laws passed recently. The PPP act is expected to be gazzetted today."We have started the negotiation, they will meet the entire cost, we will only allow them to charge a toll," said Githae during a PPP workshop held in Nairobi without disclosing the names of the firms. He said they are still doing the feasibility studies to estimate the cost.

Githae said the government is also considering issuing a concession for construction of a standard gauge railway line from Mombasa to Kampala.

This, he said, would save the public sector an estimated $6 billion (approx. Sh516 billion)."I do not see why we should not give the railway project to a concessionaire and run it for 20-25 years, which would free a lot of government resources for other social sector investments. We are talking of 6 billion dollars," the minister said.

The current railway line has been in operation for over 100 years, and it is also under a concession.The director of PPP at Treasury, Stanley Kamau said the transport and energy will have priority when the law comes to effect.

Kamau said other projects being negotiates on include expansion of JKIA, the Nairobi Commuter rail, Nyali bridge construction, Kisumu sea port, 600MW coal project, the geothermal expansion and construction of a cancer and diagnostic centre.

He said some of the projects will be completed in one year but not give specifics.

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