Economy

World Bank wants Sh1trn Kibaki-era projects stopped

road

A road under construction. The national government has 3,972 ongoing projects, many of which are delayed, incomplete or stalled. FILE PHOTO | NMG

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Summary

  • The World Bank has called for the cancellation of incomplete infrastructure projects worth Sh1.1 trillion, mostly initiated during the Kibaki era whose termination could expose Kenya to legal suits.
  • The national government has 3,972 ongoing projects, many of which are delayed, incomplete or stalled.
  • The Bretton Woods institution said Kenya, which has set aside Sh516 billion for all development projects, is unlikely to fund the 522 dormant plans that are increasing funding pressures and piling up pending bills.

The World Bank has called for the cancellation of incomplete infrastructure projects worth Sh1.1 trillion, mostly initiated during the Kibaki era whose termination could expose Kenya to legal suits.

The national government has 3,972 ongoing projects, many of which are delayed, incomplete or stalled.

The Bretton Woods institution said Kenya, which has set aside Sh516 billion for all development projects, is unlikely to fund the 522 dormant plans that are increasing funding pressures and piling up pending bills.

“Dormant projects with very low completion rates and high outstanding costs may be considered for rationalisation provided that a requisite assessment of contract, legal and financial implications is undertaken,” the World Bank said.

It observed that 40 per cent of the projects became white elephants during the transition to devolution. County governments failed to allocate funds for 195 irrigation projects initiated in the second term of President Mwai Kibaki.

According to Kenya Public Expenditure Review published by the World Bank, 53 projects are dormant because of diverse factors including litigation, wayleave challenges, acquisition of land and donor funding hitches.

The Treasury budget ceilings to tame expenditure have also resulted in the stalled projects.

The Northern Corridor, Kenya’s strategic transit route with a mix of rail, road, pipeline, ports and inland waterways makes up 72 percent of the value of dormant projects of which 22 require Sh798 billion to complete.

Kenya’s race to secure the Northern Corridor against competition from Tanzania’s Central Corridor saw the formation of the Coalition of the Willing with Uganda and Rwanda to implement the capital-intensive projects.