Sh1.2 trillion railway contract reserved for one China company

Kenya has awarded a Ksh1.2 trillion tender of building the Mombasa-Malaba Standard Gauge Railway line to a Chinese firm.

Transport and Infrastructure Secretary Michael Kamau on Thursday said the decision was in accordance to the terms given by the China government when Nairobi signed a loan agreement with Beijing.

Mr Kamau appeared before a parliamentary committee to address concerns raised on the manner in which China Bridges and Roads Company was awarded the contract.

“We had to follow their (China’s) procurement procedure,” said the cabinet secretary. The options, the committee heard, were limited to picking China Bridges and Roads Company, which signed a memorandum of understanding with the Kibaki government in 2011.

In the memorandum, the firm promised to assist in a government-to-government deal supported by concessional loans from the China Export Import (Exim) Bank.

In August, President Uhuru Kenyatta visited China and signed a Sh425 billion loan, a large portion of which is to fund the new railway line.

National Assembly Speaker Justin Muturi last week directed the parliamentary Transport committee to investigate claims raised by Nyali MP Hazron Awiti on whether the government followed due process.

The Transport cabinet secretary said that after due diligence was done by both governments, the firm was found competent.

“This money has been guaranteed by the Chinese government and they cannot channel Sh1.2 trillion to a briefcase firm,” noted Mr Kamau.

China Bridges and Roads Company, Mr Kamau said, has branches in 40 countries globally and has the financial and technical capacity to construct a high scale railway line.

MAJOR ROLE
The company will have a major role in the Northern Corridor Transport and is currently building the northern by-pass road.

Mr. Awiti called for government to provide evidence of the due diligence on the Chinese firm as well as other big projects it had handled.

“We need to know if the company has the professional qualification for railway construction awarded by the ministry of Housing and Urban Rural Development of the People’s Republic of China,” said Mr Awiti.

Mr Kamua, accompanied by his permanent secretary Nduva Muli, added that China Bridges and Roads listed 14 railway projects and was deemed fit to carry out the work.

The government intends to construct the new railway between Mombasa and Malaba in the next three years to ease movement of goods and services, and is set to commence on Thursday next week.