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Nairobi mulls Sh200b infrastructure bond

Nairobi mulls Sh200b infrastructure bond
Nairobi City Hall. PHOTO/Print
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Nairobi County will be in the market for a Sh200 billion infrastructure bond to sort the city’s transport and infrastructure mess.

The decision comes after the government’s Bus Rapid Transit (BRT) system that was slated to begin in June failed to take off.

For several years now, the county has been planning to roll out the BRT system, but poor systemic policies have seen the government fail to lure potential investors into the multi-billion project.

Nairobi Governor-Elect Johnson Sakaja revealed that the county has received proposals to expand the current infrastructure.

“On transport, we have the medium term and the long term plan. In some of the proposals for BRT we have received PPPs where the investors will construct and pay themselves after like 15 years, while others are saying we do the infrastructure bond,” said Sakaja.

Past research estimates that Kenyans lose in excess of Sh119 billion a year in lost productivity due to grinding traffic which causes many people to lose working hours in traffic, in East Africa’s largest city.

The World Bank says absence of an enabling, legal and regulatory framework, coupled with ineffective coordination with existing public transport operators undermines commercial viability of such a project.

Despite underlying challenges, the multilateral lender shared key reforms and how to see the system can be actualised.

Kenya has also been advised to set up institutional capacity which should be tasked to oversee the budget, planning, construction, and operations of BRT systems.

The National government through the Nairobi Metropolitan Area Transport Authority is implementing Bus Rapid Transport on some routes of the city.

In May the Kenya Urban Roads Authority awarded a Sh583 million consultancy contract to a Korean consortium, led by Kunhwa engineering company for the construction of the Bus Rapid Transport Line 5, along Outer Ring road is set to begin in June 2023.

In 2017 President Uhuru Kenyatta established the NAMATA to cover Nairobi, Kiambu, Kajiado, Machakos and Murang’a and to establish an integrated, efficient, effective and sustainable public transport system.

On February 26, 2019, Transport Cabinet Secretary James Macharia gazetted transport corridors in the city.

BRT Line 1 runs from Limuru-Kangemi-CBD-Imara Daima-Athi River and Kitengela.

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