Kenya has backtracked on the planned Ksh1.64 billion ($16.4 million) purchase of high capacity buses for use in Nairobi's Bus Rapid Transit system project and will instead use public-private partnerships.
Local manufacturers will lose out as they had been assured of supplying half the buses.
The government has withdrawn from the planned Ksh1.64 billion ($16.4 million) purchase of high capacity buses for use in Nairobi's Bus Rapid Transit system project. This dims hopes for local manufacturers, who had been assured that they would supply half of the vehicles.
The alternative plan will now see the private sector -- through a consortium of public transport sector operators -- purchase the buses and run them under regulations set by the Nairobi Metropolitan Area Transport Authority (Namata).
Housing and Urban Development Principal Secretary Charles Hinga on July 22 said the government was pulling out of the initial plan due to budgetary constraints.
"The buses had not been paid for. We were in the process of negotiating for them as the government planned to buy the first buses for the pilot phase in order to provide leadership in the new public transport model. We ran into budgetary constraints and will now engage the private sector to purchase the buses as we focus on infrastructure," Mr Hinga said.
The move now complicates a Buy-Kenya Build-Kenya initiative that the government had with local vehicle assemblers. The state then promised to buy from local assemblers and even cut the plan from 64 to 32 buses.
In 2018, vehicle assembler Isuzu East Africa unveiled its first locally-assembled buses, specifically designed for the BRT system in Kenya in readiness for the promised business.
Isuzu's prospects in the project are now uncertain since private sector buyers will not be bound by the previous government deal and may choose to source the buses from elsewhere.
However, Isuzu East Africa managing director Rita Kavashe said project investors would still prefer to buy from the local assemblers due to the many benefits they stand to gain.
"It has always been easier to coin the products for the private sector because they will be guided by the business viability and I don't think they will pay Ksh25 million ($250,000) for one bus when there is an option of a Ksh10 million ($100,000) locally-assembled one locally," Ms Kavashe said, adding that the government was making the right move by starting with the infrastructure and then moving to the vehicles.
The government had rushed to procure buses long before the roads were ready and has now been forced back to the drawing board to demarcate roads afresh, build stations and footbridges at a cost of Ksh5.6 billion ($560 million) on Thika super highway before rolling out the plan, which will involve 950 buses when fully implemented.
Dar es Salaam was the first city in East Africa to launch a BRT system, and it has helped ease public transport hitches. The government completed the first phase of the 21-kilometre Dar es Salaam Rapid Transport (Dart), which has five terminals, 27 stations, seven feeder roads and three connector stations. About 140 buses operate daily on the special lanes.