The government of Kenya on Wednesday held talks with the International Finance Corporation (IFC) to explore potential collaboration on Public-Private Partnerships (PPP) geared at financing mega projects including the Malaba Expressway.
A high-profile delegation led by Treasury Cabinet Secretary John Mbadi and Principal Secretary Chris Kiptoo met with senior officials from the IFC in Washington to discuss possible areas of partnership.
While welcoming IFC's advisory support, CS Mbadi stressed PPPs have the potential to help Kenya achieve its development goals through innovative financing of key infrastructural projects.
He also semphasized the importance of sensitising the public on the PPP model to enable Kenyans to understand how Kenya can realise untapped opportunities that are there for the taking.
The Treasury CS also emphasized the government's goal of utilizing PPPs to shift the burden of major infrastructure projects off the government's balance sheet, reducing overreliance on loans and exchequer financing.
PS Kiptoo also expressed keen interest in asset monetization, identifying the proposed Expressway from Nairobi to Malaba, at the Kenya-Uganda border, as a prime opportunity.
"The Malaba Expressway could significantly enhance trade and regional connectivity. Through a PPP arrangement, we can fast-track its construction and management without burdening the exchequer," PS Kiptoo stated.
The PS underscored the need for thorough risk assessment in PPP projects, ensuring they do not place undue strain on public finances. "PPPs should be reserved for high-priority projects where the benefits clearly outweigh the risks," he added.
On their part, the IFC officials outlined several areas for potential collaboration, including asset monetization, legal reforms, and strengthening the regulatory framework for PPPs.
IFC maintained that asset monetization allows the government to generate revenue from public assets without relinquishing ownership, thus alleviating pressure on the exchequer.
They also stressed the need for legal reforms to create an investor-friendly environment and a strong regulatory framework to ensure transparency and efficiency in PPP projects.
Both leaders reaffirmed the government's commitment to pursuing innovative financing models that drive development without increasing public debt. IFC Advisory Services in Public-Private Partnerships supports governments in structuring and implementing PPP transactions while fostering private sector involvement.
This comes as plans to construct the 256-kilometre Kenya-Uganda Expressway are in place after the East African Community (EAC) in April revealed plans to conduct a feasibility study over the next 18 months before works begin.
The project, which will run from Kisumu to Kakira in Uganda, is expected to improve trade ties among the EAC member states.
