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Kenya’s €1.3 Billion Nairobi-Nakuru Dual-Carriageway Deal is expected to be terminated from a consortium led by France’ Vinci SA. The project will go to a Chinese contractor instead, government officials and source said. The deal entails turning 140 km[87miles] of a single lane road into a multilane highway. This highway will join the capital Nairobi the Rift Valley city of Nakuru. Also, the deal was signed in Paris in 2020 during a visit by then -president Uhuru Kenyatta. Nairobi-Nakuru Dual-Carriageway Factsheet Cost: €1.3 billion (approximately Ksh 190 billion). Scope: Expansion of a 140-kilometer single-lane road into a multi-lane highway. Location: Linking Nairobi, the capital city, to Nakuru, a significant city in the Rift Valley. Contractor (Initial): A consortium led by Vinci Highways, which included Vinci Concessions and French private equity firm Meridiam SAS. Agreement signing: The deal was signed in Paris in 2020 during a state visit by the then-President Uhuru Kenyatta. Public-Private Partnership (PPP): The project was structured as a PPP, with the consortium responsible for design, funding, and construction, and expected to recover their investment through toll collections over a concession period of 26 years (as per earlier reports on a similar project). Reasons for termination: Unfavorable contract terms: The Kenya National Highways Authority (KeNHA) sought a restructuring of the contract terms. They deemed the contract unfavorable to the government. Financial risk: KeNHA stated that the original agreement placed the financial risk of low traffic volumes squarely on the Kenyan government. Unbankablre structuring proposal: The proposed restructuring of the contract was considered “unbankable,” leading to a stalemate between KeNHA and the French-led consortium. Compensation to French consortium: Kenya is expected to compensate the French firms for the termination of the contract. |
