Railway project won't put Kenya in debt: AG
22 January 2014, 09:51
Nairobi - The probe into the controversial multi-billion Standard Gauge Railway continues in Nairobi on the back of the Attorney General, Githu Muigai, assuring the Parliamentary Investment Committee (PIC) that the country would not incur any losses in the event that the financing of the project by the Chinese government failed.
The AG is the most recent senior government official to appear before the probing committee chaired by Adan Kaynan.
The probe team seeks to establish whether the awarding of the controversial tender followed due process.
“Supposing today the financing does not come through, what is our liability to the Chinese? Zero, because the main contract would not have kicked in the manner anticipated and it is very clear that the contract would come into force only upon the following condition- that the government of Kenya and the financial institutions of China enter into necessary financing agreement,” Muigai said appearing before the committee.
The Treasury Committee had earlier appeared before the probe team and stated that 80 percent of the project would be financed by the Chinese government whereas the Kenyan government would finance 15 percent.
Asked when the loan for financing the railway project would be paid, the Treasury Committee stated that it would create an account into which all the proceeds from the railway would be channeled.
“We are creating an account where all the proceeds that would come from the railway operations would go to this account and repay the loan,” said the committee.
The Treasury committee further assured that that they would use the railway levy fund to repay the loan incise of a shortfall.
Controversy has surrounded the railway project that President Uhuru Kenyatta launched towards the end of last year.
– CAJ News