Kenyan Railway
By The African Exponent
In what supporters of President William Ruto have termed an act of transparency and good governance, the government of Kenya has fulfilled one of its campaign promises by making public the Chinese agreement for the $3b railway in the country.
The documents of the massive Kenya project were made public by Kenya’s transport minister after years of secrecy by the successive government. The $3bn (£2.6bn) Chinese-funded and operated railway line in Kenya is the country’s biggest infrastructure project since its independence in 1963.
However, the terms of the agreement between China and Kenya and the project’s viability have been repeatedly questioned since it was launched. Critics and citizens alike feared that there was more than meets the eye.
There were claims from some quarters that the terms of the contract were not favourable to Kenya – but a few government officials – in the past administration, hence the decision to keep the documents a secret.
Since its revelation this morning, critics and stakeholders who have studied the documents claim that there were numerous unfavourable terms in the contract. At the time of filing this report, no clear-cut facts and figures have been made available to the media.
However, our team at the African Exponent will study the documents and report on the terms of Kenya’s most expensive infrastructural project, funded and operated by China.
In August 14, 2018, Kenyan government officials were charged with fraud over the $3bn railway. A Kenyan court has charged two senior government officials over land allocation for the rail line worth $3bn linking Nairobi with Mombasa, East Africa’s biggest port.
Funded by the Chinese government, the railway is one of the biggest infrastructure projects launched by Kenyan President Uhuru Kenyatta and was planned to ultimately connect South Sudan, the Democratic Republic of Congo, Rwanda, Burundi, and Ethiopia to the Indian Ocean.
According to reports, the railway forms part of China’s ‘One Belt, One Road’ scheme, which features a series of infrastructure projects to improve land and maritime routes between China and Europe, Asia, and Africa.
The project was officially inaugurated by former President Kenyatta in May 2017, praising it for representing a new chapter in the state’s history.
However, despite the fact that the multibillion-dollar project was completed 18 months earlier than anticipated, the project has been struggling to find success after being marred by corruption allegations and registering a loss of $100m in its first year of operation.
The project was also criticized by economists, critics, and citizens, who claim it only contributed to increasing Kenya’s debt, which was estimated to be around 54%-55% of its economic output. In addition to that, wildlife groups and environmental conservationists also hit out at the railway as it runs through the Nairobi National Park and Tsavo National Park in south-eastern Kenya.
An independent legal investigation into the project further fuelled the fraud allegations and revealed that officials had paid over $2m in compensation to private firms that falsely claimed to have owned part of the land crossed by the railway line.
Kenyans, the International Monetary Fund, and experts have raised questions about the repayment status of the existing loans.
The terms of repayment were also a subject of debate following revelations a few months ago that the port of Mombasa could be handed over to the Chinese if Kenya defaults on the loans, despite the fact that China continues to claim that the railway is raking in a lot of revenue.
The Chinese contractors said that the railway earned $100 million in the 2017/18 financial year and has continued to generate huge returns. When coupled with the support it has offered Kenya in the area of transportation, they say it is a worthy project – but many Kenyans disagree.
The Chinese said Kenyans form a majority of the SGR managers and employees and that their safety is guaranteed, “contrary to negative reports in the media.”
Despite the claims and counterclaims that have been reported in the media over the years, the released contract documents will no doubt offer some level of clarity on the terms of the agreement.