President Uhuru Urges China to Pay 50 Percent of the Cost of Extending SGR to Kisumu

President Uhuru Kenyatta has urged China to fund 50 percent of the cost of extending the Standard Gauge Railway (SGR) from Naivasha to Kisumu.

During bilateral talks with Chinese President Xi Jinping on Tuesday, Kenyatta sought to have the cost of the 270-kilometre line between Naivasha and Kisumu be split into a loan and a grant to relieve the country from the soaring debt.

“The Naivasha-Kisumu phase of the SGR will cost $3.8 billion. And owing to its regional significance, I would request that 50 per cent of its cost be provided as part of grant financing,” President Kenyatta told his host.

If his request is accepted by China, it will mean that Kenyan taxpayers will pay about Sh190 billion ($1.9 billion) for extension of the infrastructure to the lakeside city.

The first phase of Standard Gauge Railway from Mombasa to Nairobi was completed last year at a cost of Sh327 billion, while the second phase from Nairobi to Naivasha is ongoing and is expected to be ready by June 2019 at a cost of Sh150 billion.

“The SGR sits very well on the Belt and Road Initiative. It commences the envisaged land bridge between the Indian and Atlantic Oceans, opening up the interior for trade and investment across seven countries, and opening China to Central Africa, and further on, beyond the Atlantic Ocean,” the President said.

With Kenya's public debt now standing at Sh5.1 trillion, President Uhuru and his delegation also proposed a shift to public private partnership (PPP) in financing of other infrastructural projects.

For example, Kenya struck a PPP deal for the construction of 30-kilometre expressway from the Jomo Kenyatta International Airport (JKIA) to Westlands in Nairobi. China will finance the road but will do the tolling until it recoups its money.

The President has been in Beijing attending Summit of the Focus on China-Africa Cooperation (FOCAC).