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A boost for Kenya’s infrastructure

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Cars drive down a section of the Thika Superhighway that leads out from the northern end of the Kenyan capital, Nairobi, on January 8, 2018. Thika highway leads north towards Kenya's central highlands at the foot of east Africa's second highest mountain, Mt Kenya, and further to Kenya's border town with nothern neighbour Ethiopia some 775 kilometres (about 482 miles) away. / AFP PHOTO / TONY KARUMBA (Photo credit should read TONY KARUMBA/AFP/Getty Images)

To upgrade Kenya’s ailing infrastructure network, the government recently released much needed funds for rail and road projects that will be a significant boost for Kenya’s infrastructure       

Although the East African region will, like the rest of continent, take some time to find its feet again after the Covid-19 shock, expectations are that GDP in countries like Uganda, Rwanda and Kenya will get back on track early in 2021. This is good news for a region that has always shown great potential but could never really achieve the sort of growth economist predicted. Although there are still enormous challenges, the governments in all these countries have done a lot to improve the ease of doing business. Kenya has committed to invest aggressively in its road infrastructure, which will unlock many bottlenecks the country had to negotiate in the past.

The government road agency KeNHA recently signed a contract with American civil engineering and construction company Betchel International, to design, construct, and operate the Mombasa-Nairobi expressway. The government has allocated Ksh189-billion (about USD1.78-billion) to the Department of Infrastructure in the coming financial year to cover funding for various infrastructure projects ranging from roads to railways.

The Mombasa-Nairobi expressway project is a proposed four lane dual carriageway. The road will link the capital of Nairobi to the port city of Mombasa and reduce travel time significantly. The current highway carries large loads of traffic and has caused considerable delays for transport companies in the past. The design will allow enough room so that the carriageway can be widened to six lanes in the future.

According to the Kenyan government, the feasibility study indicated that the viability of the project rested in the operator being allowed to charge a toll to recover the costs of construction.

Other roads to receive funding during the coming year will be the Nairobi-Nakuru-Mau Summit Road and the Kenol-Marua road which runs from Thika to Nyeri. The funding of these projects comes in the wake of the government’s efforts to stimulate the economy in the aftermath of the ravages of the corona pandemic.

Earlier today, the African Development Bank said they expect Africa’s economic growth could rebound in 2021 provided that governments manage the COVID-19 infection rate well.

In a comprehensive socio-economic assessment of the pandemic’s impact, the Bank said growth was now projected to rebound to 3% in 2021 from -3.4% in the worst-case scenario for 2020.

The predictions are contained in a supplement to the Bank’s African Economic Outlook, which was released on 30 January. At the time, Africa’s growth was forecast at 3.9% in 2020 and 4.1% in 2021.

The supplement cautioned that the growth outlook for 2021 and beyond would depend largely on African governments’ effectiveness in flattening the curve of the outbreak and policies to reopen economies.

Charles Leyeka Lufumpa, acting chief economist and vice president for economic governance and knowledge management, at the African Development Bank, said: “To reopen economies, policymakers needed to follow a phased and incremental approach that carefully evaluates the trade-offs between restarting economic activity too quickly and safeguarding the health of the population. “

“Economic activities can be restarted incrementally on the basis of the transmission risks of different sectors,” Lufumpa said.

The spread of the virus in Africa depends largely on the preparedness of countries to separate and treat infected patients, the supplement stated, noting that only 21 out of 54 African countries are clinically prepared to deal with epidemics.

Executive Director of the African Economic Research Consortium and Former Governor of the Central Bank of Kenya, Njuguna Ndung’u described the African Economic Outlook 2020 supplement as “a very important and useful policy tool for African countries who actually need it  at this time.”

“It will be useful now and in the future. It gives us important short, medium- and long-term strategies,” he added, stressing crises like COVID-19 present a good opportunity for innovative reforms in countries.

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