Kenya to pay double for JKIA-Westlands Expressway

Motorists will pay between Sh111 and Sh555 to use the JKIA-Westlands Expressway launched Wednesday and the Chinese contractor will pocket Sh108.5 billion profit in the long run.

China Road and Bridge Corporation (CRBC) is projected to make Sh186.2 billion in revenues for the 27 years it will operate the road, between 2023 and 2049, before handing over the project to the government.

This is against a total construction, operation and maintenance cost of $748.9 million (about Sh77.7 billion). Construction cost will total $509.2 million (Sh52.8 billion) while operating expenses including maintenance are pegged at $239.7 million (Sh24.8 billion).

Kenya National Highways Authority (KeNHA) has, however, put the construction cost at Sh62.1 billion.

This means Kenyans will pay more than twice the cost of construction of the project in yet another Chinese-funded, built and operated project. 

CBRC has built and is operating the standard gauge railway.

 “The project is three years but the contractor has agreed to optimise and do it in two years so that by December 2021, the road should be opened to the public,”  KeNHA director general Peter Mundinia said on Thursday when he took the President through the project.

Details of the project including financial analysis show heavy vehicles with fewer than four axles will pay between Sh6 and Sh9 per kilometre, while heavy commercial vehicles with four or more axles will pay between Sh24 and Sh30 per kilometre.

“Tolling is going to be electronic so not much time is spent on the road,” Mundinia noted.

CRBC will enjoy exclusive concession terms during the construction and operation period, official documents show. These include the right to invest, finance, design, construction, own, operate and maintain and transfer the project. It also has the right to adjust the tariffs.

“No competitive projects [allowed] before, during and the specific period after the commencement of the project’s operation,” the Chinese firm has told the government.

The firm is projected to make Sh10.5 billion in the first five years (2023-2027) at an average Sh3.4 million per day, Sh26 billion in the following five years and Sh30 billion the succeeding five years. It is expected to make Sh72.9 billion in the remaining period as it maximises on its investment.

The project stems from a 2008 approval by Parliament to construct a 77-kilometre double-decker road in Nairobi under a 30-year build-operate-transfer deal.

On Thursday, President Kenyatta said the project will ease traffic along Mombasa Road, saving the time commuters spend along the highway which is prone to heavy traffic.

 The project has been delayed for nearly a decade. Its construction fast collapsed after the World Bank questioned its suitability and financing.

In September 2018, CRBC was invited to develop the project during the Beijing Summit-Forum on China-Africa Cooperation( FOCAC).

“We promptly established a team to initiate the research and study,” CRBC management notes in its development plan, which includes traffic and origin-destination survey, geological investigation, feasibility study, technical proposal and financial proposal.

“The Government of Kenya will acquire additional land which exceeds the current road reserve for construction. Based on the initial estimation, approximately 40 acres need to be acquired for the project, including the land of Kenya Railways, Uhuru Park, the University of Nairobi and Boulevard Hotel,” the study reveals.

Meanwhile, 43 per cent of Kenyans are willing to pay Sh50 and below to use the toll road while 31 per cent are willing to part with between Sh50 and Sh100. Fourteen per cent are okay paying Sh100-Sh200 while 10 per cent could easily part with Sh200-Sh500, a study has indicated.

One per cent of Kenyans are willing to pay Sh1,000 and above, placing the average payment acceptable by Kenyans at Sh155.