According to the director of China Africa Research Institute M/S Deborah Brautigam, the loans owed by Kenya, the third-highest in Africa after Angola and Zambia, were initiated by Nairobi and the two ports offered as collateral
With only six months to go before a new regime takes charge in Nairobi, the Chinese administration is said to have expressed concern about the security of their heavy investments in Kenya, a source at the Treasury told The Weekly Vision Online. He said Beijing has already made moves to try and secure trillions of shillings it is owed by Kenya.
Although details remain scanty sources have intimated that China currently Kenya’s largest external lender is moving to lay claim on the ports of Mombasa and Lamu which were offered as collateral for the loans. According to the director of China Africa research institute M/S Deborah Brautigam, the loans owed by Kenya, the third-highest in Africa after Angola and Zambia, were initiated by Nairobi and the two ports offered as collateral. President Uhuru Kenyatta has made several visits to Beijing to negotiate and secure external loans.
So far Kenya has declined to make public the details of the huge loan owed to China. Beijing financed the construction of the SGR in 2014 and several other multi-million shillings projects
President Uhuru Kenyatta has in the past said the borrowed money had been used on upgrading roads but multi-lateral lenders from the west claim a huge chunk is also stolen by senior bureaucrats in government. So far Kenya has declined to make public the details of the huge loan owed to China. Beijing financed the construction of the SGR in 2014 and several other multi-million shillings projects. The cost of the SGR project was faulted by western lenders as over-priced, citing Ethiopia and Malawi as having covered longer distances and cheaper. The Chinese also built the Thika Superhighway, and the ongoing JKIA-Westlands Nairobi Express highway.
According to the China Africa research institute, Kenya has no viable minerals or oil and gas to offer as collateral, unlike Angola and DRC. The oil discovered in Kenya’s Turkana County is already in the hands of a UK-Canadian consortium Tullow while a few gold mines in western Kenya remain economically untenable. Nairobi has chalked up a staggering Ksh. 9 trillion in debt which is expected to soar further, with this year’s expense on the general election to be held on August 9.
Kenya’s 2010 new constitution created a devolved government system that ballooned the public wage bill to staggering proportions. Up to 60 per cent of Kenya’s GDP goes into paying salaries and allowances of a bloated public service with many performing duplicated functions. Multi-lateral lenders have in the past, urged Nairobi to merge some of the counties, abolish others and scrap duplicate positions in the national and county governments.
There’s no story that cannot be told. We cover the stories that others don’t want to be told, we bring you all the news you need. If you have tips, exposes or any story you need to be told bluntly and all queries write to us [email protected] also find us on twitter.