The government of Kenya will construct 3,000 Km of roads during the initial phase of planned construction of 10,000 Km of road networks launched earlier this August.
An updated report from the Ministry of Transport and Infrastructure indicates that the 3000km is an upgrade from the initial 2000km earlier planned for the Phase I construction. The 3000 kilometers of roads will either be built or rehabilitated in 45 lots during the first phase of the project.
The roads will be constructed under the annuity where contractors are assured of constant flow of cash through loans from local banks while they design, construct and maintain the roads. Treasury will then repay the loans over a period of eight years in equal installments (annuity), starting from the time the construction works are concluded.
Through this annuity model, the government will be able to transfer construction, operation and maintenance risks to the private sector where all this work was initially being performed by the state.
The multibillion project is being undertaken by the Kenya Urban Roads Authority (KeRRA), the Kenya Urban Roads Authority (KURA) and the Kenya National Highways Authority.
The project is expected to start in December to enhance connectivity, promote trade and attract investment by reducing the cost of doing business. The construction works for the roads is expected to be finalized by 2017. The total cost of the project has been put at US$ 3bn.