Kenya has secured $150-million from the Africa Development Bank (AfDB) to finance the construction of the Nairobi–Nakuru–Mau Summit highway, a critical gateway to neighbouring Uganda, Rwanda, Burundi, South Sudan and the Democratic Republic of Congo (DRC).
The project falls within Kenya’s northern corridor, a key conduit for cargo destined for the six neighbouring countries, especially cargo imported from overseas through the Kenyan port of Mombasa.
Merchandise valued at $61.2-billion was transported to these countries through the northern corridor in 2020, down from $64-billion in 2019, according to data from the Northern Corridor Transport Observatory.
The port of Mombasa’s transit cargo volume increased from 8.64-million tons in 2017 to 10.17-million tons in 2020, but declined by 6.2% to 9.54-million tons in 2021.
Uganda accounted for the lion’s share of transit traffic through the port of Mombasa in 2021, equivalent to about 76% of the total volume. South Sudan accounted for 11% and the DRC 8%.
In recent years, the northern corridor has been facing increasing competition from Tanzania’s central corridor, where significant amounts have been invested to encourage more countries in the region to use the port of Dar es Salaam.
The funds from the AfDB will finance the conversion of the existing 175 km A8 road from Rironi to Mau Summit into a four-lane carriageway and the strengthening and maintenance of the 57.8 km, two-lane A8 South from Rironi to Naivasha over 30 years. The project will be undertaken as a public–private partnership (PPP).
The loan forms part of a tranche to Rift Valley Highways, a special-purpose vehicle incorporated in Kenya that is wholly owned by VINCI Group and Meridiam Infrastructure Africa Fund.
Rift Valley Highways entered into a PPP concession agreement with the Kenya National Highway Authority in September 2020 to design, build, finance, operate, maintain and transfer the two stretches of road over 30 years.
The toll highway, whose total cost is $1.5-billion, forms part of the wider continental Highway 8, a 6 259 km trans-African highway stretching from Mombasa to Lagos, in Nigeria, that has become even more crucial with the advent of the African Continental Free Trade Area (AfCFTA).
“Tolling and concessioning of major trade corridors across the African continent are on the rise as the need for connectivity and integration is amplified by the AfCFTA and the need for alternative financing sources through PPPs to ensure the sustainability and reliability of trade corridors,” says AfDB infrastructure and urban development acting senior director Mike Salawou.
He adds that, apart from aligning with the aspirations of Kenya’s Vision 2030 and the country’s national strategy to support industrialisation through infrastructure development, the Kenyan highway project also aligns with the AfDB’s infrastructure priorities, which are anchored on integration, industrialisation and improving the quality of life on the continent.