Project News
IFC Pledges Sh40bn for Nairobi-Mau Summit Highway
The move is likely to unlock more funding for the Sh190 billion project.
The World Bank’s International Finance Corporation (IFC) has pledged Sh40 billion ($320 million) in financing for the Sh190 billion Nairobi-Mau Summit Highway, in a move that is likely to unlock more funding for the project.
The global financier, which in February published the project’s environmental and social impact assessment (ESIA) documents for public review, is expected to approve the release of the funds in the 2023/24 financial year.
This is likely to unlock more funding for the Nairobi-Nakuru-Mau Summit Highway, which will be built under a Public-Private Partnership (PPP) framework.
At the same time, the International Development Association (IDA) – an affiliate of the World Bank – is likely to issue a partial guarantee to the project.
“Planned new bank lending include a possible IDA partial risk project guarantee on the $1.5 billion Nairobi-Nakuru-Mau Summit Toll Road with IFC participating as an investor,” the World Bank said.
A bank guarantee promises that in case a contractor defaults on its loans the bank will cover the costs or loses. It reassures vendors who may need to provide their products or services on credit to complete their part of the project.
The project will involve upgrading the existing 175km A8 road from Rironi to Mau Summit into a four-lane dual carriageway, and the rehabilitation of the two-lane A8 South Road between Rironi and Naivasha.
RELATED: Nairobi-Mau Summit Highway Project Set for Kickoff
The Nairobi-Mau Summit Highway project will be undertaken by Rift Valley Highway Limited (RVHL), a consortium led by Vinci Highways and Meridian.
The company has already signed a design, build, finance, operate, maintain and transfer contract with the Kenya National Highways Authority (KeNHA).
Under the deal, Kenyans will pay toll fees over an estimated period of 30 years in a bid to help the project’s operator and financiers recover their investment.
IFC joins the African Development Bank (AfDB), which in July approved a $150 million (Sh19 billion) loan for the toll highway project.
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