Kenya inks $2.23 billion projects deal with China - The East African

Kenya inks $2.23 billion projects deal with China

Friday April 26 2019

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Kenya and China on Friday signed project delivery agreements worth Ksh226 billion ($2.23 billion) for a tech city and an expressway.

President Uhuru Kenyatta, who is in China for the second Belt and Road forum, witnessed the signing of the deals that will be fulfilled through concessional financing and Public Private-Partnership (PPP).

The Konza Data Centre and Smart Cities deal is worth Ksh175 billion ($1.72 billion) while the JKIA-James Gichuru expressway project is worth Sh51 billion.

Also signed was the operation and maintenance service agreement for the Nairobi-Naivasha segment of the standard gauge railway (SGR).

The Konza project —situated about 80km south east of the capital Nairobi— was conceived in 2017 by the ICT ministry and telecommunications giant Huawei.

It entails the development of core infrastructure including a National Cloud Data Centre, Smart ICT Network, Public Safe City and Smart Traffic Solution, and a Government Cloud and Enterprise Service.

It is part of the Konza Techno City, a Vision 2030 flagship project started in 2008 and aimed at developing technology-intensive and high-tech industries in ICT, biotechnology and e-commerce.

It is estimated that Phase I of the project will create over 17,000 jobs and contribute Ksh90 billion ($900 million) to the Kenyan economy.

The construction of the expressway is expected to ease traffic flow on the busy Mombasa highway as part of government interventions to decongest key roads in Nairobi.

It will be the first of its kind in Africa, with features such as underpasses, overpasses, exits and the Bus Rapid Transit (BRT) component covering the entire stretch.

Earlier, President Kenyatta attended the opening ceremony of the forum at the China National Convention Centre in central Beijing, where he addressed a high-level session that President Xi Jinping attended.

He thanked China for projects which he said were expanding economic activities and unlocking the potential for prosperity in Kenya and other developing countries.

“Since inception, the Belt and Road Initiative has forged cooperation in the development of critical sectors including infrastructure, education and capacity building, trade facilitation and investment, agricultural modernisation, industrial promotion and energy connectivity," he said.

Regional transformation

The President said Kenya was proud to be a founding and active member of the BRI and that it shares a common vision with China - the development and transformation of the country and East Africa.

“[Kenya is] a gateway to the African segment of the Golden Belt of the BRI that stretches from the port of Mombasa to Kisumu, on Lake Victoria and the East African hinterland, to the port of Kinshasa," he said.

"In addition is the Lapsset corridor that connects the Great North Corridor to northern Africa."

While noting that Kenya proactively plays its role in the delivery of the BRI, through Mombasa port's modernisation and construction of the SGR, he asked other countries to do the same.

Mr Kenyatta further said that to reap the full benefits of the BRI, focus should be on synergy in infrastructure and industrial development and more participation by the private sector.

He welcomed China's commitment to more imports, saying Kenya would ensure both nations benefited.

Investors

At another function, President Kenyatta invited Chinese investors to partner with the government and local entrepreneurs in setting up businesses in Special Economic Zones (EPZ) being developed in parts including Dongo Kundu in Mombasa, Lamu, Kisumu and Naivasha in Nakuru County.

He said the government was backing up infrastructure development with a range of policy reforms aimed at creating an enabling environment for trade and investment to thrive.

“My government has adopted a comprehensive investment policy to guide procedures and processes, both at national and county levels," he said, while opening the Kenya-China Business Forum organised by the Kenya Investment Authority (KenInvest) and the China Africa Development Fund.

"We have also established a one-stop centre to facilitate ease of doing business and automated service delivery through innovative platforms such as Huduma Namba, e-Citizen, e-Regulations, iTax, Single Window Electronic Clearing System and the Land Registry."

The President noted that as a result of robust economic planning, fiscal reforms and good governance, the 2018 growth rate of the Kenyan economy was the highest in nine years.

“Our Economic Survey released only yesterday (Thursday) indicates that (economic) growth remains resilient and broad-based, accelerating from 4.9 in 2017 to 6.3 per cent in 2018, well above government and IMF estimates,” he said.

President Kenyatta is on a three-day working tour with government officials including Cabinet Secretaries Monica Juma (Foreign Affairs), Peter Munya (Trade) and James Macharia (Infrastructure).

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