Kenya Seeking More SGR Loan From China

Kenyan President Uhuru Kenyatta (Left) and Chinese President Xi Jinping prior to a bilateral meeting in Beijing, China in 2018.
  • Kenya is among East African countries seeking for a loan to complete the construction of the Standard Gauge Railway (SGR) from Naivasha to Kampala, Uganda.

    A report by South China Morning Post on Sunday, September 5, indicated that the countries had planned to make their pitch to China for funding.

    The countries which include Kenya, Uganda, Rwanda and South Sudan were set to make their appeal during a Forum on China-Africa Cooperation (FOCAC) summit is held in Dakar, Senegal.

    The event is scheduled to take place at a later date in 2021.

    Kenyan President Uhuru Kenyatta (Left) and Chinese President Xi Jinping prior to a bilateral meeting in Beijing, China in 2018.
    PSCU

    The countries, which were set to benefit from the project, are looking for ways to complete the project from Mombasa to Uganda.

    The East African nations came together in 2014 and secured a loan from the Export-Import Bank of China (China Eximbank) for the project.

    At the time, the bank approved Ksh320 billion for the SGR project from Mombasa to Nairobi and an additional Ksh150 billion to extend it to Naivasha where it has since stalled.

    Eximbank is said to have withheld its continued funding for the project after directing Kenya to carry out a feasibility study for the project.

    The Railway was set to connect East African nations including South Sudan, Rwanda and the Democratic Republic of Congo.

    Experts in China told the publication that the Asian country is highly likely to turn down the request from the East African nations at the event.

    “Going forward, I would still expect Eximbank and [China Development Bank] to be at the forefront of financing for large-scale projects on the continent but with the caveat of displaying a greater degree of caution, especially towards projects which may be sold as more political than financial in nature,” the publication quoted Benjamin Barton, a professor at a University in Malaysia.

    While appearing on Citizen TV on Sunday, August 29, Wanjigi lifted a lid on how SGR budget ballooned from Ksh55 billion to Ksh300 billion during the course of its construction.

    “SGR was a project birthed by me in 2008 with a company called China Road and Bridge. We birthed it, we spent a lot of money doing what you call feasibility studies and technical studies.

    “What I recall of the project cost was something like Ksh.55 billion, from Mombasa all the way to Malaba. After 2013, it came to my attention that it was now not a project worth Ksh.55 billion between Mombasa and Malaba but Ksh300 plus billion just from Mombasa to Nairobi. And I said this does not make sense to me. This is where we differed,” stated Wanjigi.

    The Mombasa Terminus of the Standard Gauge Railway.
    The Mombasa Terminus of the Standard Gauge Railway.
    File
  • Source: KENYAGIST.COM