Kenya secures Sh7.2bn deal to fund Galana irrigation project

Tuesday March 1 2016

Galana-Kulalu farm in Tana River County. The President has secured the backing of Parliament to proceed with the Galana-Kulalu irrigation plan. PHOTO | EVANS HABIL | NATION MEDIA GROUP

Galana-Kulalu farm in Tana River County. The President has secured the backing of Parliament to proceed with the Galana-Kulalu irrigation plan. PHOTO | EVANS HABIL | NATION MEDIA GROUP 

By OTIATO GUGUYU
More by this Author

Kenya’s mega food security project received a major boost after President Uhuru Kenyatta clinched a Sh7.2 billion loan deal during his tour of Israel.

The President has also secured the backing of Parliament to proceed with the Galana/Kulalu irrigation plan.

An Israeli firm contracted by the government to undertake trials for the project will have access to the funds in the next few weeks.

Green Arava had been facing cash flow problems, delaying the initiative, which was due to be completed in March this year.

There had been concerns that a stalemate over implementation of the plan would put 500 acres of maize ready for harvest at risk of getting spoilt.

The government is now pushing the firm to deliver the 10,000-acre model farm by July, ahead of Prime Minister Benjamin Netanyahu’s visit.

“The financing agreements have now been concluded and we have been talking to the company, which has committed to deliver the project ahead of schedule so that their prime minister can commission it during his visit,” Water and Irrigation Cabinet Secretary Eugene Wamalwa said in Kibbutz Kalia, Israel last week.

Green Arava water and soil engineer Gideon Kedar told the Nation that the firm had not received payments for the last seven months but is now expecting to get the funds in “a matter of weeks”.

“We are aware the process is well advanced and once we get the money, we will be able to complete the project in under nine months,” said Mr Kedar.

The National Irrigation Board, which is implementing the project, says the plan has cost taxpayers Sh2.5 billion since it was initiated, bringing 1,000 acres under irrigation.

GOOD INITIATIVE
Apart from the loan, the Israeli Government is also providing an additional Sh3.5 billion grant for training.

The government says it now has an option of drawing only Sh5 billion from the loan or renegotiating with Israel to extend the project.

The advance is to be repaid in 15 years and attracts 2.3 per cent interest, which the government considers a good bargain.

The government has also received approval to start drawing the loan, even as President Kenyatta signed agreements for further development assistance on Tuesday last week.

The Parliamentary Committee on Agriculture said it had thrown its weight behind the project, lifting the suspension that took effect in December last year.

National Assembly Committee on Livestock and Agriculture Vice-Chairman Kareke Mbiuki told journalists that the team was satisfied with the capacity of Green Arava after touring its establishments in Israel.

“We had our reservations as to how the project was designed. Kenyans were not aware of the true picture and essence of the project. However, the misconceptions have been put to rest,” Mr Mbiuki said in Israel during President Kenyatta’s visit.