Kenya, Ethiopia and Sudan turn to crowdfunding to finance Lapsset

Thursday January 16 2020

Ethiopia's ambassador to Kenya Melos Alem, South Sudan's undersecretary for transport David Hassan, Kenya's representative on infrastructure Raila Odinga and Cabinet Secretary for transport James Macharia display copies of the agreement on the Lapsset project on January 14, 2020. PHOTO | LABAN WALLOGA | NATION MEDIA GROUP


Kenya and its landlocked neighbours, Ethiopia and South Sudan, will use crowdfunding to raise the billions of shillings required to build infrastructure linking their economies.

In a memorandum of understanding (MoU) signed by ministers to speed up implementation of the Lamu Port-South Sudan-Ethiopia-Transport (Lapsset) Corridor project, the three states have also agreed on joint budgetary allocation.

The MoU was signed at a meeting in Mombasa at the Kenyan coast, presided over by the African Union High Representative for Infrastructure Development Raila Odinga. The ministers resolved to harmonise regulations and run joint marketing for the project.

Lapsset seeks to link the three states via rail, airports, roads and oil pipelines. Under the project, Lamu is set to become eastern Africa’s largest seaport with 32 berths.

The states agreed to jointly mobilise finances and investors at a function attended the African Development Bank, United Nations Economic Commission for Africa and African Union’s New Partnership for Africa Development (AU-Nepad).

“The adoption of the project by the AU will give it an upper hand in crowdfunding to raise cash to supplement the usual national budgetary allocations,” Kenya’s Transport Cabinet Secretary James Macharia said.


Since its launch, each of the countries have focused on their national portion of the project, what has been blamed for the slow pace of implementation.

“The new regional project implementation programme will assist partner countries to hasten development of the project and this commitment will attract more financiers to bring this project to success. In the past, each country has been funding its own projects," Mr Raila said.

The new plan will be implemented in two phases under East-West Beltway corridor and land bridge.

The project adoption by the AU gives it sufficient mileage and exposure to attract foreign direct investment (FDI) and other financing.

The first phase will cover Lamu-Isiolo-Addis Ababa to Djibouti while the second phase will connect Lamu to Kribi/Doula via Juba and Bangui.

Ethiopia’s ambassador to Kenya, Melos Alem, refuted claims that his country had dumped the project.

“Ethiopia is the largest country and we need infrastructure to make business cheaper, that is why we are investing in the Lapsset corridor and we have already tarmacked more than 500 kilometres from Moyale to Awasa...We are for the project,” he said.