Politics and policy
Treasury signs Sh6bn Chinese loan to boost e-government plans
Posted Sunday, July 1 2012 at 16:10
Kenya’s public administration is set to get a boost through a Sh6 billion (460 million yuan) loan from China earmarked for building national fibre-optic infrastructure and the e-government projects.
Treasury PS Joseph Kinyua and the visiting Chinese vice-minister for commerce Chen Jian signed provisional agreements for the loan, paving the way for negotiation of lending terms. The fibre-optic networks will link Nairobi with former provincial headquarters and 36 administrative district centres through local area networks connected to the national backbone.
“Once completed, the project will provide a safer, more reliable, stable and efficient basic communication network for the government and the Kenya citizens,” said Mr Kinyua (pictured right) during the signing ceremony at the Treasury last week.
He said the projects will improve quality of the public service and improve decision-making.
The PS also invited China to finance three berths of the planned 35-berth Lamu port. The three berths require Sh21 billion as estimated by the Ministry of Transport, Mr Kinyua said. Mr Jian said the amount China could lend Kenya for development depend on the willingness of Chinese institutions.
Official Chinese government lending to Kenya stands at Sh109 billion. Among the projects financed by Chinese lenders include part of the Nairobi-Thika highway and the Olkaria geothermal field production. The loans are for a period of 15 to 20 years with a grace period of two to five years.
Mr Kinyua said the government was also keen on financing for the Constitution implementation. “There are challenges in mobilising financial resources to finance the devolved county governments,” he said.
Mr Jian said China was ready for more trade with Kenya, saying volumes between the two countries were growing quickly.
The Economic Survey 2012 says Kenya-China trade was Sh148 billion in 2011, including imports and exports.
However, the trade is heavily in favour of China, which exported goods worth Sh144 billion to Kenya but imported Sh3.8 billion worth of goods.