Kenya on the verge of its biggest construction boom

Kenya is on the verge of its biggest construction boom in many years – with tens of multi-billion-shilling infrastructure projects fuelling the country’s economic growth.

The majority of these works are spread across several projects in rail, roads, port, energy, oil and gas.

The World Bank’s Kenya Economic Update has indicated that sustained infrastructure investment and falling global oil prices will see the local economy grow by seven per cent in 2017.

The World Bank said that heavy spending on infrastructure projects such as the standard gauge railway would also see the Kenyan economy joining the list of the fastest growing economies in Africa.

Data from a survey by global consulting firm Deloitte show that 60 per cent of large infrastructure projects in Kenya in 2014 were mainly in the transport sector while projects in the energy sector took up 37 per cent of recorded projects.

READ: Inventory of major construction projects in Kenya

The Deloitte African Construction Trends Report 2014, which was released on Tuesday in Nairobi, looked at projects in energy, transport, mining, healthcare and real estate in Africa that had value of more than Sh4.55 billion.

The survey found that there were 51 such projects spread in Kenya, Uganda, Tanzania, Rwanda and Ethiopia worth Sh5.5 trillion, which was a 55 per cent drop from 93 projects worth Sh6.2 trillion recorded in 2013.

“While there seems to have been a dip in current activity, there are a large number of significant projects in the planning phase that have not yet reached financial close and are thus not yet reflecting in the statistics of projects under construction,” Mark Smith, the head of infrastructure and capital projects at Deloitte East Africa, told reporters in Nairobi.

Some of Kenya’s major infrastructural projects include the Sh327 billion standard gauge railway from Mombasa to Nairobi, the Sh2 trillion Lamu Port South Sudan Ethiopia Transport (Lapsset) Corridor and the Sh55.6 billion Greenfield Terminal at the Jomo Kenyatta International Airport in Nairobi.

Others include the much awaited Dongu Kundu Free Port, the Sh900 billion Konza technology city, the Kenya Railways Golf Cities, among others.

The government is planning to construct and rehabilitate 5,500km of roads through a public-private partnership (PPP) and another 20km of new roads in every constituency by 2017.

In the 2015/2016 fiscal year, the National Treasury has set aside a special intervention kitty of Sh25 billion that will be used to revamp the country’s roads, rail and airport infrastructure projects.

The Treasury has also allocated Sh125.5 billion towards financing the maintenance of existing road network and construction of new roads.

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