China funds delay stalls hospital upgrade

The expansion of the Moi Teaching and Referral Hospital (MTRH) has been thrown into disarray after China failed to approve the Sh25 billion project for funding this year.

Hospital director John Kibosia told the National Assembly departmental committee on health that a contract signed with China Machinery Engineering Corporation (CMEC) in November would have to be renegotiated or a new financier sought.

“We have indication from the Chinese government that our project was not approved for funding this year. If the 10 months provided for in the preliminary agreement lapses, then the contract goes into oblivion and we will be forced to renegotiate or institute an entirely fresh process,” Dr Kibosia said.

The director did not explain why the Chinese did not approve the funding but promised to give the committee written reasons later.

“He promised to give us documents relating to the financing deal and the decision not to fund the project as agreed in the preliminary agreement,” committee chairman Rachael Nyamai said.

MTRH and CMEC had entered into the provisional agreement for construction of a 1,000-bed complex, a four storey car park to accommodate 500 vehicles, a 500-kilowatthour solar plant, an incinerator and access roads. The agreement will expire in August.

Dr Kibosia said a final contract was to be signed after approvals by government officials and after securing a loan from a Chinese bank.

In a unique arrangement, the contractor would have been paid in full in advance against a bank guarantee equivalent to the contract sum that the project would be completed.

The committee had invited Dr Kibosia to give details on the costing, the site and the status.

The committee questioned the variation in the cost estimates, which CMEC put at Sh25.1 billion ($291.6 million) against MTRH’s Sh17.7 billion ($205.9 million).

Dr Kibosia said MTRH estimates did not include the incinerator, electricity overhaul, fire protection, solar power generation, elevators, survey and engineering, which would cost Sh7.5 billion.

“The feasibility study for the upgrade project which has been conducted within the hospital site indicates the need for a proper incineration plant. It is only the Aga Khan hospital that has a proper incineration plant in Kenya,” Dr Kibosia said.

He added that the upgrade was preferred because “moving the hospital to a new site will require immense resources to compensate for current facilities.” Moi University, Medical Training College (MTC) and MTRH training school are within the hospital precincts.

“Moving the hospital to a new site will also require similar facilities to be shifted,” Dr Kibosia said.

The hospital is set on 44 hectares, including three hectares of the former Uasin Gishu Memorial Hospital. The hospital plans to decommission some of its old buildings to pave way for construction of modern ones.

The site reserved for expansion is about four kilometers from the tarmac road and is not serviced, the director said.

“The proposed site has pending legal issues which have to be cleared before the request for future land expansion is concluded and formalised,” Dr Kibosia said.

He said the site would be ideal for future MTRH Group of Hospitals that includes a mental health annex, infectious diseases centre and tropical medicine institute.

The hospital has approached the ministry of Interior to be allocated 200 acres of prison land next to the Eldoret Airstrip where a county hospital would be developed.