MPs Push Uhuru to Renegotiate SGR Contract

  • President Uhuru Kenyatta flags off SGR Phase 2A at the Nairobi Terminus on Wednesday, October 16, 2019
    President Uhuru Kenyatta flags off SGR Phase 2A at the Nairobi Terminus on Wednesday, October 16, 2019
    PSCU
  • Parliament now wants President Uhuru Kenyatta to renegotiate the Standard Gauge Railway (SGR) contract with the Chinese government.

    In a report tabled by the Public Investment Committee led by Mvita MP, Abdulswamad Nassir, the Members of Parliament noted that there was a need to have the payment schedule adjusted to protect the country's property.

    In particular, MPs stated Kenya would lose the Mombasa port should the country fail to pay its loans as agreed with the Chinese government which financed the project.

    A file image of impounded ethanol containers at the Kenya Ports Authority
    A file image of impounded ethanol containers at the Kenya Ports Authority
    FILE

    “A reading of the agreement left no doubt that the Kenya Ports Authority (KPA) and the Kenya Railways Corporation (KRC) were borrowers and therefore liable to repay the loan through their assets without immunity. This put the assets of KPA at risk in the event of a default.

    “The committee recommends that the National Treasury should renegotiate the entire payment arrangement agreement with a view to discharging the KPA from the contract and replacing it with the KRC,” read parliamentary committee report in part.

    Further, the Legislators lamented the opaqueness of the contract even stating that the government has failed to make public details of the contract since 2013.

    “It was inconceivable that the KPA could sign an agreement with the KRC agreeing to provide a certain tonnage of goods for transport through the SGR and be held liable in the event of failure in a free-market economy where transporters were at liberty to use any mode of transport including road," added the committee.

    The recommendations by Parliament comes days after a Mombasa Court ordered the government to make the contract public following a petition.

    “It is clear that the respondents’ attempt to hide behind the provisions of sections 3(6) & (7) of the Official Secrets Act flies in the face of Article 35, section 29 of the Access to Information Act and falls to be rejected.

     “This court would be going against the letter and spirit of the Constitution if it were to be persuaded by the respondents’ argument that the petitioners failed to exhaust the statutory dispute resolution mechanism under such circumstances, it would amount to condoning an illegality,” Justice John Mativo ruled.

    In recent days, the SGR has been used as an agenda by politicians in their campaigns with Deputy President William Ruto accusing the government officials of altering the original SGR plan.

    "The SGR was intended to make the port much more efficient. Unfortunately, a few people took hostage of the whole program and ended up with selfish programs that benefit a few people to the detriment of the people at the Coast," Ruto stated.

    Left to right Deputy President William Ruto talks to his running mate Rigathi Gachagua and Garissa Town MP Aden Duale.
    Left to right: Deputy President William Ruto talks to his running mate Rigathi Gachagua and Garissa Town MP Aden Duale.
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