Kenya Secures Ksh77 Billion Loan to Fund Key Road Projects
Kenya is about to receive a major financial boost to support its road infrastructure projects.
Treasury Cabinet Secretary John Mbadi has confirmed that the government is finalizing a Ksh77 billion loan (equivalent to USD 600 million), which will go towards improving and maintaining roads across the country.
This new funding is backed by the road maintenance levy, a charge collected from motorists each time they purchase fuel.
Currently, the levy is set at Ksh18 (approximately USD 0.139) per litre. The funds collected are managed by the Kenya Roads Board, which handles road maintenance on behalf of the government.
Given the country’s tight budget and rising public debt, Mbadi explained that the government has opted to securitise the road maintenance levy.
This means using the predictable income from the fuel levy to secure cheaper loans. The goal is to allow the Kenya Roads Board to access more affordable credit to address urgent roadworks and pay contractors who have been waiting for payments.
Mbadi clarified that the Ksh77 billion loan will not go to the Treasury directly but will be channeled straight to the Kenya Roads Board.
The money will be used primarily to settle pending bills with road contractors and to speed up crucial infrastructure works.
As Kenya looks for additional funds to complete ongoing road expansion projects, the government has also turned to China for financial support.
In fact, the Ksh77 billion loan is just part of a broader financial plan. Mbadi also revealed that the government is pursuing a larger funding package, which could either be structured as a privately placed bond or a syndicated loan.
This means the government is actively exploring different financial instruments to raise money for development.
While addressing the National Assembly on Wednesday, April 16, Mbadi also confirmed that Kenya has successfully secured a Ksh78 billion loan facility from the World Bank.
The money is expected to be disbursed in June 2025. He attributed earlier delays in the disbursement to the pending Conflict of Interest Bill, but assured lawmakers that those issues had been resolved.
Additionally, Mbadi announced that another loan amounting to Ksh34.3 billion (USD 265 million) is expected to be released within the next week, offering more hope for the continuation of stalled development projects.
Over the years, Kenya has depended heavily on external loans to fund its ambitious infrastructure agenda. The latest loan follows President William Ruto’s earlier efforts, which saw the country secure Ksh40 billion to revive 15 road projects that had stalled across more than 10 counties.
Kenya’s efforts to raise funds have also involved diplomacy. After recent meetings between CS Mbadi and Chinese Ambassador to Kenya Guo Haiyan, as well as a follow-up visit to China, the government has confirmed plans to resume the long-delayed extension of the Standard Gauge Railway (SGR).
This SGR extension will cover a 475-kilometre stretch from Naivasha to Malaba, near the Uganda border.
According to agreements made earlier this year, a consortium of Chinese companies will finance 40 per cent of the project.
The move marks a renewed push to expand Kenya’s railway network and improve trade routes across East Africa.
In summary, Kenya is actively pursuing multiple sources of funding to upgrade its road and rail infrastructure, even as it works to manage its national debt.
These new loans, combined with international partnerships, are expected to help complete stalled projects and drive economic development across the country.
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