The government has entered into 10 new loans worth Sh132 billion to finance infrastructure projects in the last six months.
The new loans secured from bilateral and multilateral lenders include Sh17.6 billion for the first and second phase of Nairobi Intelligent Traffic Systems (ITS) establishment. It also includes junctions improvement project phase two. Additionally, Sh6.5 billion for ongoing Bus Rapid Transit (BRT) and Sh7.7 billion for arid and semi-arid land rural roads project were secured. Finally, Sh2.6 billion is allocated for Lake Victoria and sanitation project in Kisumu.
Other projects include Samatar-Wajir road at a cost of Sh2.2 billion. There is Sh4.2 billion for Technical and Vocational Educational Training and Entrepreneurship (TVETTE). Furthermore, Sh86 million will be used for Horn of Africa gateway.
Details of the loans are contained in a report tabled in the Senate. It shows the loans contracted by the government between September 1, 2020, and March 31, 2021.
“Four of the loans are from a multilateral lender and six is from bilateral lenders. The value of the 10 new loans signed is equivalent to Sh132,376,087,111.43. One of the loans has been disbursed by the time of submitting this report,” states the report.
The document indicates that the loan for BRT Line 5 Project was signed in January. The Export-Import Bank of Korea is the lender.
“The amount of the loan is Sh6,461,196,200, and it will be repaid in Korean Won,” states the document.
According to the agreement entered between the bank and the Kenya government, the loan will be paid in 60 semi-annual installments of KRW 1,092,592,593. This will start from July 20, 2031, through to January 2061.
The interest rate of the loan is capped at 0.1 percent per annum on the disbursed loan amount. The service charge of the loan is 0.1 percent per annum on the disbursed loan amount.
The government seeks to use the loan to implement the BRT project. The project aims to improve the transport system in the Capital city. It seeks to reduce traffic snarl-ups on various major roads.
Works on pick-up and drop-off points are currently in progress on Thika Super Highway to pave way for high-capacity express buses that will use the inner lanes on both sides of the dual carriage.
The points linked to footbridges will then serve as BRT stations erected along islands between the carriageways. This means passengers boarding or alighting will not have to worry about crossing through the lanes.
Loan for Nairobi ITS establishment and junctions improvement project phase two was also secured. The loan comes from the Export-Import Bank of Korea.
The Sh10,951,180,000 loan (USD100,000,000) will be repaid in 60 semi-annual installments of KRW 1,851,851,851.85. This repayment will occur from July 20, 2031, through to January 20, 2061.
“Purpose of the loan is to finance implementation of the project whose objective to provide the structural improvement of junctions and expansion of ITS; enhance urban mobility and safety in Nairobi and reduce social cost caused by traffic congestion,” states the document.
Another Sh6.7 billion has also been secured for the first phase of Nairobi ITS establishment. This phase focuses on junctions improvement project.
The project seeks to reduce social losses due to traffic congestion. It also aims to enhance urban mobility in Nairobi through the development of ITS.
The Sh2.2 billion for Samatar-Wajir Road Project will be used to upgrade the 90km section between Samatar and Wajir town. The upgrade will be to asphalt concrete standard with a 7-meter wide carriageway and 2-meter wide shoulder on each side.
The government seeks to spend Sh4.2 billion loan on TVETTE. The goal is to increase access to technical education and training. This will be achieved through the expansion of infrastructure and training equipment, including for students with special needs.
The loan will also be used to improve quality and relevance of technical education through demand driven competency based education training curriculum.
Source-https://www.standardmedia.co.ke/
