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US Envoy denies debt risk over Sh300 billion expressway

NEWS
By Bloomberg | November 4th 2019
By Bloomberg | November 4th 2019
NEWS
Ambassador Kyle McCarter. He maintains his country is committed to fulfill Trump, Uhuru pledge on road. [Wilberforce Okwiri, Standard]

The US government denied that developing a proposed expressway between Kenya’s biggest cities risks debt stress for the country as it plans to raise its borrowing ceiling to continue funding infrastructure projects.

While a local daily reported last month that the US government halted funding for the highway on concerns of mounting debt, the ambassador to Kenya denied this.

“Contrary to press reports, the highway is an investment that won’t saddle Kenya with unsustainable debt,” Ambassador Kyle McCarter said on Friday in a statement. “The project by a world-class US company will provide the best engineering solutions for Kenya’s infrastructure needs at a lower price than competitors.”

Kenya awarded in 2017 the $3.5 billion (Sh360 billion) project, among its biggest in more than five decades, to Bechtel Group to develop a 473-kilometre (294-mile) road between the capital, Nairobi and port city of Mombasa.

The expressway would be another project disrupted on concerns of debt or feasibility after China held funding for a section of a railroad earlier this year.

The government has proposed to increase its debt ceiling to almost match the size of the economy, and raised its 2019-20 budget-deficit forecast to 6.2 per cent of gross domestic product following revenue shortfalls.

The US is “fully committed” to the Nairobi-Mombasa expressway and to fulfill the shared pledge of the countries’ presidents Donald Trump and Uhuru Kenyatta, “to make this critically needed road a reality,” McCarter said. The dualing of the road to ease perennial traffic snarl-ups was to be done by American engineering firm Bechtel after Kenya and US struck a deal during last year’s meeting between Presidents Trump and Uhuru at the White House.

The proposed road will be a dual-carriage motorway with four lanes to ease congestion and cut travel time between the two cities from the current 10 to about four hours.

It will run parallel to the current Nairobi-Mombasa highway and will help promote trade and movement in Kenya and the neighbouring countrie. Bechtel had estimated that construction of the expressway would create 500 jobs and involve local businesses.

– Additional reporting by Standard Reporter

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