Treasury allocates Sh9bn for building Lamu port corridor


Treasury building. FILE PHOTO | NMG

Treasury has allocated Sh8.85 billion for development of the Lamu Port corridor, envisaged to provide an alternative infrastructure passage to the Indian Ocean.

Budget estimates for the year starting July show the Lamu Port-South Sudan-Ethiopia (Lapsset) project, which is on course, has been allocated the amount in addition to the Sh2.5 billion it received in the current financial year.

Early in the month, President Uhuru Kenyatta and Ethiopia’s Prime Minister Abiy Ahmed Ali committed to the development of Lapsset, through completion of the Ethiopia-Kenya interconnection transmission line.

The leaders said Kenya and Ethiopia, which already enjoy “the highest level of diplomatic status” with each other, would embark on a new drive to raise trade and diplomatic ties.

“Kenya has always considered Ethiopia to be a brother. We have collaborated from before independence where Ethiopia played a leading role in supporting Kenya gain independence,” Mr Kenyatta said at State House during Mr Abiy two-day State Visit to Kenya.

The Lapsset infrastructure project was conceived to improve access to and connectivity between Kenya, South Sudan and Ethiopia.

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The plan is to eventually form a land bridge across the Great Lakes region from eastern coast of Africa (Lamu) to western coast (Douala) in Cameroon.

The project, which requires up to Sh2 trillion to complete, is one of mega infrastructure projects mooted under Kibaki’s administration alongside Konza technology city and the standard gauge railway (SGR).

The mega projects were put on the back burner during Mr Kenyatta’s first years in office as they failed to receive any allocation from the Treasury.

The projects sprung back to life after the Treasury returned them to its priority list in the year ended June 2016.

At the moment, Ethiopia, which is landlocked, has mainly relied on the Port of Djibouti for sea link to the rest of the world after the 1992 independence of Eritrea cut its Red Sea connection and rendered it landlocked.

Unlike Kenya whose territorial Indian Ocean waters cover about 128,015 square kilometres but does not have a single merchant ship, Ethiopia has more than a dozen state-run seagoing vessels.

Ethiopia’s drive to shift part of its sea-based transport to Kenya implies that a corridor running from Addis Ababa to Lamu must equally be developed urgently.  That will allow its traders to move exports to Lamu and ship imports back by trucks and trains.

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