Kenya construction and infrastructure sector to grow by 9% this year, says Business Monitor International

Nairobi-Thika-Highway Kenya roads and infrastrcuture sector
Thika Super-Highway in Kenya

The Kenya construction and infrastructure sector is anticipating a growth of 9% year-on-year in 2015 according to Kenya Infrastructure Report Q3 2015 released this month by Business Monitor International. The growth in the sector is expected to remain over a 10-year forecast period to 2024.

A Long-term interest in the construction and infrastructure sector will be driven by successful issuance of Eurobond. Issuance of the bond will also boost the government’s ability to finance infrastructure developments; so reports Business Monitor International.

Although some growth in the construction and infrastructure is expected, insecurity in some parts of the country and devolution of fiscal powers will affect further growth via delays in investment in infrastructure, residential and non-residential sectors.

Business Monitor International cites among the key developments include a USD1.2bn project to connect Kenya, Zambia, and Tanzania electricity grid, which is likely to earn more revenues for the countries through exportation of electricity and also expected to alleviate power outages according to Christopher Yaluma, Zambia’s Minister of Mines, Energy and Water .

The deal agreement for the project has already been signed by the governments. The countries will be hooked via 1,600km of power transmission lines. It is expected to start at the end of this year and be completed by December 2018.

Kenya has, from last year, rolled out massive road annuity infrastructure program that would together see construction and/or rehabilitation of 10, 000km of roads. The project has already started and, although there were challenges being reported by local contractors in regard to prequalification requirements and local banks in regard to funding, the government is expecting to have roads constructed by local firms through funds from banks and other sources and then be payed after completion of the contracts.

Both local and international contractors are participating in the roads annuity project. Kenya is also undertaking the LAPSSET project, where a railway network and port of Lamu are anticipated.

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