Tanzania, Uganda overtake Kenya in major infrastructural projects

The ongoing super structure on berth number one at the Lamu port. East Africa’s race for the biggest port is still on. [Maarufu Mohamed, Standard]

Kenya’s East African peers will race past it as the new home for mega infrastructure projects in 2019, thanks to President Uhuru Kenyatta’s austerity measures.  

Debtwire, an intelligence service that researches and reports on corporate debt situations, put the value of Tanzania’s prospective infrastructure projects at Sh650 billion, far ahead of Kenya’s Sh50 billion.

Even Uganda will be teaming with more lucrative projects compared to Kenya, valued at Sh550 billion.

This comes at a time when Treasury tabled a report in Parliament revealing that implementation of some 545 major projects had stalled as the President initiated harsh austerity measures.

Kenya’s only project to watch this year, according to authors of the report, is the upgrading of the more than 100km of highway between Nairobi and Magadi at a cost of Sh5 billion.

“Kenya will also table a road brownfield project to upgrade more than 100km of highway between Nairobi and Magadi for $500 million (Sh50 billion) as reported. Concurrently, some progress on the Nyali bridge project is expected,” read part of the Africa Project Finance Trend Update 2019.

Construction of a crude oil pipeline linking Uganda and Tanzania, which Kenya lost to the latter, will account for Dar es Salaam’s heavy infrastructure spending this year.

“Tanzania in 2019 will be at the forefront of the infrastructure transactions with the East Africa Crude Oil Pipeline (EACOP) project,” reads part of the report which listed seven transactions in the region among Tanzania, Uganda, Kenya, Djibouti, and Ethiopia.

EACOP will be owned by private companies along with Ugandan and Tanzanian national oil companies, according to sources quoted in the report.

“The export pipeline to cross Uganda and Tanzania is attracting interest from Chinese financial institutions as previously reported. The total project cost is estimated at $3.5 billion (Sh350 billion) and will be developed on a public-private partnership basis over a concession of 30 years,” read part of the Africa Project Finance Trend Update 2019.

Debtwire is a subsidiary of Acuris Company, a British media company.  

Tanzania will also build a 1,057km rail, the second phase of a 2,561km railway project masterplan. Total debt sought will be up to Sh300 billion.

The building of Nyali Bridge is Kenya’s other project to watch and was appropriated in the current budget ending June.

Treasury allocated Sh72.3 billion for development activities by the State Department for Infrastructure in the current financial year.

By, December 2018, Treasury had released Sh28.9 billion for infrastructure projects such as roads, energy projects, bridges, dams and so forth.

In Uganda, the authors of the report expect a major oil downstream transaction to approach the market next year, with front-end engineering design for a Sh400 billion having been agreed upon.

The other project in Uganda that is on their radar include progress on the 95km Kampala-Jinja highway, with the cost of the project estimated at Sh150 billion. Although relations between Dar es Salaam and Nairobi have improved, the two East African economic powerhouses have been on each other’s throat.

Both countries have put in place elaborate plans to ensure they win the battle of economic supremacy.

Even as Kenya has embarked on building a 32-berth port at Lamu, Tanzania as inked a deal with the Chinese to develop one at Bagamoyo, which is expected to handle about 20 million containers. It has been billed as East Africa’s race for the biggest port.