Weakening shilling to hit expressway users in the pocket

Southern Bypass toll station. [Elvis Ogina, Standard]

It will cost you more to use the Nairobi Expressway after the government adjusted the toll charges upwards to cushion the project’s investors from the weakening local currency.

The Transport and Infrastructure Ministry on Friday published new toll rates, increasing the minimum amount motorists can pay to Sh120 from the earlier Sh100, while the maximum will go up to Sh1,800 from Sh1,550. The charges will depend on the distance that motorists will cover on the expressway as well the size of their vehicles.

In a gazette notice, Cabinet Secretary James Macharia revoked the earlier rates that had been published in December 2020.

The shilling has since weakened against the US dollar, dropping to a low of Sh115.5 on Friday.

The old rates were set when the local currency exchanged at Sh103.79 to the US dollar but the ministry noted that it has since weakened to Sh113.14 to the dollar. The local unit Monday was trading at 115.70 against the greenback.

The ministry said the rates can be adjusted at any time to cater for inflation as well as the performance of the shilling against the dollar. “The Base Toll Rates may be adjusted as per the CPI (Consumer Price Index) and exchange rate on and after the Commercial Operation Date,” said CS Macharia in the gazette notice.

The new rates will see motorists pay Sh360 for a saloon car to travel the entire 27.1km  from Mlolongo to Westlands in comparison to Sh310 which had been initially gazetted.

The Sh360 is the base toll rate for the entire length of the expressway, with other vehicles paying high rates depending on size.

Heavy commercial vehicles, with four or more axles, will pay the highest amount for the entire 27.1km distance at Sh1,800.

The minimum amount, which will vary from Sh120 for saloon cars and Sh600 for trucks with four or more axles, will only afford motorists short distances, such as moving between Haile Selassie Avenue and Museum Hill.

The toll that motorists will pay will enable China Road and Bridge Corporation (CRBC) to recoup the Sh88 billion it has spent building the road as well as cater for maintenance costs over the 27 years it will operate the road.

The toll motorists will pay will enable CRBC to recoup the Sh88 billion it has spent building the road. [David Gichuru, Standard]

The company built the road through a Public-Private Partnership (PPP) model, whereby it designed, sourced funds and undertook construction works. The government facilitated through the provision of such things as land.

CRBC recently formed Moja Expressway, which will operate the road before transferring it to the government.

The firm started construction works in October 2019. The road is nearing completion, with the Kenya National Highways Authority (KeNHA) in a statement recently saying there will be guided trials of the road and the systems that have been installed, including the automated toll gates.

The Transport Ministry has in the past told Parliament the road will generate Sh302 billion over the period CRBC will operate the road.

Of this amount, CRBC is estimated to make Sh106 billion (or Sh3.7 billion per year) after the initial investment and the operational costs are deducted from the revenues.

Ambulances, police and military vehicles will be exempted from paying the road toll. Boda Bodas and tuk-tuks will not be allowed on the road.

Motorists who opt to pay to use the road will avoid heavy traffic and other inconveniences, with KeNHA estimating that the road will reduce travel time for motorists from two hours during rush hour to between 10 and 15 minutes over the 27km distance.