Archive for the ‘Loan Agreement’ Category

Outer BizOutering Road expansion project which is now 25% complete is slowly shaping up into a new look and will definitely be one of the iconic features  of Nairobi given the huge structures that are being erected by the Chinese contractors. According to Kenya Urban Roads Authority (KURA -), new funding has to be negotiated between Kenyan government and African Development Bank (AfDB-) to finance the new design near Taj Mall area.  Road construction cutting across busy and densely populated neighborhoods will always cause some level of disruption and its value cannot be quantified financially but social impacts can be gradually experienced and Outering Road expansion project will not be an exception.

Some years back when Thika Highway was being upgraded, section between Guru Nanak and Fig Tree along Murang’a was dotted with several petrol stations, car selling yards and was turning into being the alternative business hub of some kind. But once the road was complete, all the vibrancy was gone and Murang’a Road turned into being quite neighborhood with a busy highway unfriendly to public transport users while pedestrians have to walk long distance to use a bridge.

Looking at Outering Road expansion, many businesses have been displaced or forced to relocate to pave way the road construction. This is already causing strain on the limited business spaces within the affected communities and which has affected renting rates. A walk inside Kariobangi Market and along Kagundo Road near Umoja reveals an already over crowded place that cannot accommodate new traders while there are no enough social amenities. The remaining option has been to turn some of the residential houses into business premises. The previously easy life of doing business along Outering Road and crossing the road is all gone.

From the look of things, road construction should also come along with investing in the affected neighborhoods (Mathare North, Baba Dogo, Mathare, Kariobangi North/South, Buru Buru, Umoja, Donholm, Mukuru, Tena, Pipeline estates.) Construction and expansion of already existing markers in areas such as Kariobangi South, Umoja, Donholm and Pipeline can help mitigate socio-economic stress related with road construction effects. The motorist users will definitely appreciate the new developments given the nightmare of traffic jam associated with the current status of the road.

Investing in road infrastructure without considering social implication of the development to the neighboring communities can be catastrophic for the future generation. When Waiyaki Way was upgraded some years back with funding from the European Union, it was hailed by all. Unfortunately some years later communities were cut off from social networks, social amenities such markets and hospitals, left with uncovered quarries filled with rain water, a nice road without footbridges and regular pedestrian deaths.

Nairobi County government needs to be supported by the African Development Bank (AfDB) to invest prudently in social projects such as markets and business parks to spur economic within the affected neighborhoods since the county government is busy decentralizing some of its services. All the Nairobi County managed markets are in poor state and requires expansion to accommodate more traders.

Emission from motor vehicles has been known to be the biggest contributor of air pollution. Increased tree covered in the affected communities can help reduce the effect of air pollution.

Three lessons from Thika Superhighway experience are; road construction is not a preserve of the Ministry of Roads and associated agencies alone but well co-ordinate partnerships with all parties involved. Public awareness on various aspect of road needs to star early or concurrently with the ongoing road construction so that by the time road is being completed, community members are conversant with newly introduced road features. This can help save lives and motivate road users to utilize new road features such as footbridges, walk paths and bicycle lanes. Finally loans negotiated for road project should not focus alone of road features but include some funding for social investment and policy changes in conjunction with county governments. There is no need of constructing bicycle tracks while the government has not enacted positive laws/rules to motivate ownership and use of bicycles.


loanThe Outering Road Upgrade loan takes effect as from March 2014 and Kenya will finish repayment by 2046…Read the details below;

The National Treasury signed a kshs.9.8 billion concessionary loans towards the construction of Outering Ring Road in Nairobi City County. The project, whose construction is set to start in April, 2014 is expected to cost approximately Kshs. 10.5 billion with African Development Bank (AfDB) contributing 88.5% loan and partly a grant while Kenya Government will finance 11.5% of the total cost. Kenya Urban Roads Authority (KURA) advertised for bids for the project and will be opened early February, 2014.

Speaking during the signing ceremony, Treasury Cabinet Secretary Mr. Henry Rotich asked the Ministry of Transport and Infrastructure to ensure the project is undertaken within the approved time schedule. “I urge you to ensure it is done in time as time is of essence for the public to enjoy the benefits of the project”, he said.

Speaking during the occasion, Mr. Gabriel Negatu, the Banks Regional Director for the Eastern Africa Regional Resource Centre said, ‘the project will benefit an estimated population of at least 2.2million people who represent 70% of the Nairobi City County population and will reduce travel time to commuters, improve air quality, property values, improve business environment and social welfare” .

Nairobi Governor, Dr. Evans Kidero praised the Bank for the support saying eastlands is receiving a major project after a long time and his Government plans to transfer Wakulima market to this part of the City.

Transport and Infrastructure Principal Secretary, Eng. John Mosonik said, “The objective of the Project is to improve the existing Outer Ring Road in the city of Nairobi into a dual carriageway in a bid to expand its Traffic carrying capacity to address congestion, reduce carbon emissions and to provide social infrastructure such as market stalls for the informal traders (most of whom are women) and Wellness centres to address HIV/AIDS and related illnesses.”

The 13km dual carriageway starts from Ruaraka /Thika Road Junction to Taj Mall, Eastern Bypass in Embakasi. The scope of the project involves daulling(two lanes in each direction), service Roads, 10 footbridges, 9metre Bus Rapid Transit(BRT) to be constructed at a later date, Non-Motorized Traffic and six grade separated junctions. The introduction of footpaths and cycle tracks on either side of the roads is an added value as Government moves to encourage members of the public to be environment conscious and use safe tracks while footing or cycling to and from City Centre.

The design provides ten footbridges and four subways for the safety of pedestrians across the highway. It also provides for underground services for cables and water lines and a Bus Rapid Transit (BRT) corridor to be constructed at a later stage. During the construction deviation roads of about 12km will be upgraded for use by the public and include; Thika Superhighway – Mathare North – Juja road; Mtarakwa – Komarock Road; Embakasi Barracks – Kangundo Road and Eastern Bypass-Outer Ring Road.

The Project is set to also improve social and environmental projects along the road corridor with the planting of 4,500 seedlings and provision of welfare facilities. Under the project, at least 500 youths (60% to be women) in three years shall be selected to be trained as artisans in local technical training institutions to enhance their skills to enable them secure gainful employment thereafter. Source: