Sh60bn Lamu-Isiolo highway a landmark on Lapsset stretch

Amid electioneering, we may be failing to notice a number of critical news items. Last week the Ministry of Transport announced a Sh60 billion funding for a 580 km bitumen road from Lamu to Isiolo.

The funds are from the Development Bank of Southern Africa (DBSA). I will explain why committing this road project is a very important and timely milestone.

This stretch of the road is part of Lapsset corridor highway project which will eventually link Lamu Port, through Garissa, Isiolo, Samburu County, and end at Lokichar in Turkana where it will join the Eldoret-Juba highway.

At Isiolo it will intersect with the new northbound road to Moyale.

It is important that the port and the highway are developed simultaneously, because a port without a modern road to evacuate and feed it with goods will be a lame duck.

Of all the Lapsset corridor projects, it is the highway that will have the widest socio-economic multiplier effects in the northern counties.

The road will stimulate all manner of enterprises as old towns along the corridor grow and new ones spring up. Improved inter-county communication will usher in new economic perspectives and opportunities.

A new road will definitely improve security assurance through enhanced access to security systems. It will promote inter-ethnic integration while making it easier to mitigate acts of cattle rustling and terrorism.

Effective security incubates successful commerce, trade and development in general.

The northern Kenya economy is principally anchored in livestock. The Lapsset project appropriately made provisions for Lamu port to export live cattle. In the Lamu town master plan there was land set aside for livestock quarantine, fattening and export quality certification.

As work on the port and highway progresses, it is important that the national and county governments mainstream this livestock export project to commercialise the livestock sector in the northern counties.

Livestock based exports can in deed be a niche activity for the new port of Lamu.

Since the launch in 2012, the integrated Lapsset corridor project is gradually taking good shape. And Mwai Kibaki, the ex-President, must be happy in his retirement to see his dream project being resourced.

Construction of the of the anchor port at Lamu is already committed. Grid power is already in Lamu. A private power plant that will use the port to import coal has received regulatory go-ahead.

As discussed above the Lamu-Isiolo road has financing already lined up, and Isiolo-Moyale road is advanced work in progress.

A grassroots airport at Isiolo is done while Manda airport at Lamu has been expanded. A new airfield now exists at Lokichar, thanks to the oil investors. A Lokichar-Lamu crude oil pipeline will likely be in place by 2022.

Above all devolution has ushered in county governments which by now should have basic capacities to harness the Lapsset infrastructure and activities to empower the local communities to improve their lives.

In this respect, the counties must urgently undertake human capacity development by way of technical and entrepreneurial skills.

Over the past few years changing regional geo-economic landscapes have altered the initial assumptions used to formulate the Lapsset project.

South Sudan opted to continue exporting their crude oil on the existing infrastructure via Port Sudan on the Red Sea.

There is also another option by South Sudan to export crude oil via the planned Uganda/Tanzania pipeline.

With the ongoing Kenya/Uganda SGR project, a railway project along the Lapsset corridor is for all intent and purpose a dead idea.

The ongoing SGR will likely be extrapolated all the way to Juba via Uganda. However, with a modern highway from Lamu to Juba, and an efficient Lamu port, the corridor can still command competitiveness to handle exports and imports for South Sudan.

There was also a refinery at Lamu which was premised on tapping crude oil from South Sudan. When the Lapsset plan was finalised in 2011, Kenya had not discovered oil in Turkana. The apparent Kenyan policy has no provision for local crude oil refining.

This policy can always change when more oil is discovered, but the refinery location may favour Isiolo or other location nearer the petroleum demand markets.

In respect of Ethiopia, the country has essentially firmed up their logistics plans to focus on the port of Djibouti for petroleum products and dry cargo. The Lamu port does not appear a priority in their plans, except perhaps for the southern parts of Ethiopia.

For Lapsset corridor completeness and effectiveness, there are three missing pieces requiring urgent implementation.

Firstly, the Isiolo-Lokichar fraction of the highway to provide critical logistics support for the construction of the planned Lokichar-Lamu crude oil pipeline. The road section will also add value to Lamu port by providing early linkage for South Sudan transit trade.

Secondly, without a refinery in the Lapsset corridor, there will be no products distribution pipelines from Lamu. As such, a pipeline branch from the main Mombasa pipeline should be installed all the way to Isiolo to service the northern counties.

Thirdly, there is a need to firm up plans for sustainable supply of fresh water to Lamu. The initial plan was to pipe water by gravity from a dam upstream of River Tana.