Infrastructure

State Now Allocates Sh39bn for Dongo Kundu SEZ Project

The special economic zone will sit on a 3,000-acre piece of land.

Updated on

February 4, 2023

Trade CS Moses Kuria with Mombasa Governor Abdulswamad Shariff Nassir | CK — Trade CS Moses Kuria (left) confers with Mombasa Governor Abdulswamad Nassir on Jan 16. (Photo: MITI)

The government of Kenya has allocated Sh39 billion for development of Dongu Kundu Special Economic Zone (SEZ) in the port city of Mombasa in a move that signals the imminent launch of the much-awaited project.

According to Trade, Investments and Industry Cabinet Secretary Moses Kuria, plans for the inauguration of the SEZ are at an advanced stages to ensure the envisioned industrial and logistical hub becomes a reality.

“We are currently working to float a tender for land development in the local and international media to attract investments.

“Hopefully, tenders will be issued within one or two weeks and the work will start on 31 March 2023,” Mr Kuria said during a tour of the Mombasa Port on Jan 16.

Requests for Expression of Interest (REOI) in investing in Dongo Kundu Special Economic Zone and Naivasha Special Economic Zone have since been issued.

In Dongo Kundu, Kenya is seeking to attract investments in petrochemicals, oil and gas, agro-processing, green energy, water desalination and service provision.

Other areas of interest include blue economy, steel, automobile industry, textile, pharmaceuticals, warehousing, cargo bulk-breaking, and freight logistic services.

Vision 2030 project

“The Special Economic Zone development project at Dongo Kundu is one of the Vision 2030 flagship projects in the (coastal) region,” the CS added.

SEZs are areas with different economic rules from those of other regions within the same country and are set up to promote rapid economic growth in a country.

When it is set up, Dongo Kundu SEZ – which is also known as Mombasa Special Economic Zone – will include a free port, free trade zone, logistics zone, industrial park, and a public utility area with a 12km road network.

The SEZ will be established on a 3,000-acre parcel of land.

Mr Kuria said the facility is expected to be operational from July 1, adding that the Kenya Ports Authority (KPA), the executing agency for the project, has set aside Sh1.4 billion to compensate those who will be displaced by the project.

Government officials

The resettlement and compensation process will be spearheaded by national government officials led by coast region commissioner Rhoda Onyancha.

The Kenya Electric Transmission Company has been given up to March 31 to ensure the site has the provision of 12km of 33 KV And LV network of internal power for the last mile distribution, awaiting completion of the Mariakani Dongo Kundu power supply line and Dongo Kundu substation.

On the other hand, Coast Water Works Development Agency is expected to design and build sewerage reticulation and common effluent treatment by March 31.

Mombasa Governor Abdulswamad Nassir pledged to assist on the part of the survey and the identification of the affected persons.

“We will ensure that we assist in the water and sewer plans and seek other political leaders so that the money for compensation is paid to the right people and do it on the stipulated time,” he said.

Grant aid agreement

In June last year, Kenya and Japan signed a Sh5.23 billion grant aid agreement for the execution of phase one of the project in Dongo Kundu area.

According to the Japan International Cooperation Agency (Jica), the funds were for improving water supply facilities, rainwater drainage channels, and land situated within the Mombasa SEZ Development Master Plan.

The project, which was scheduled to kick off in July last year, will be executed with funding from Jica – structured as a Sh6.6 billion grant and a Sh5.5 billion concessional loan that is payable in 30 years.