The Treasury has secured Sh22.29 billion (€180 million) deal in concessional loans and a grant with three European agencies for water and sewerage projects in Mombasa and Kisumu.
Treasury secretary Henry Rotich Thursday announced the agreements with French Development Agency (AFD), which will provide €140m (Sh17.3bn), European Investment Bank €35m (Sh4.3bn) and a €5m (Sh619m) grant from the 28-nation European Union.
The billions will be used to build a new dam in Mombasa while in Kisumu the fund will be used to seek new water sources and upgrade supply networks in works that will also benefits satellite towns in western Kenya.
Increased population and poor weather, which has caused drop in water volumes in current reservoirs, has seen the two cities struggle to meet the water and sewerage needs of their residents.
Businesses have been forced to hire private companies to supply them with supplemental water, and some have sunk expensive boreholes on their property.
AFD will offer €120m (Sh14.8bn) loan to boost the water production capacity at Mwache Dam in Mombasa.
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