Revealed: Details of The SGR Deal That Saw Kenya Grant China Vast Powers.

Joy Waweru | 1 year ago


The Standard Gauge Railway contract was finally disclosed by Transport and Infrastructure Cabinet Secretary Kipchumba Murkomen after years of being held in high confidentiality and secrecy.

During the vetting process, Kipchumba  Murkomen had promised to Kenyans to make public the SGR contract signed between the Kenyan government and China during Uhuru Kenyatta’s tenure. He argued that Kenyans deserved to be made fully aware of the terms of the contract.

Murkomen stated that the contract would be tabled in parliament as pertinent issues such as assets of the Kenya Port Authority were elusive.

The SGR is arguably the most extensive and expensive project the former government undertook valued at $1.6  billion and a 0.25 percent commitment fee.

Despite court orders compelling Uhuru’s administration to reveal the contents of the SGR contract, the government retained the documents under lock and key away from public scrutiny.

The government however shed light on the speculations in January this year citing that the contract had a Non-Disclosure Agreement and its revelation would jeopardize the business relationship with China as well as risk national security.

However, the details released yesterday reveal how Kenya granted the Chinese government an upper hand in the agreement.

According to the contract resolution of any dispute would be held in Beijing  China.

“If no settlement is reached through friendly consultation, each party shall have a right to submit a dispute to the China International Economic and Trade Arbitration Committee for arbitration,” the contract stipulates.

The terms of the contract also bound the Kenyan government from revealing its content to the public.

“The Borrower shall keep all the terms and conditions hereunder in connection with this Agreement strictly confidential. Without the prior written consent of the Lender, the Borrower shall not disclose any information hereunder or in connection with this Agreement to any third party unless required by the applicable law,” the contract stipulates.

In the contract, China required Kenya to establish an inland container depot in Nairobi, mandatory customs clearance, and a Railway Development Fund.

China’s terms require that Kenya gives priority to their market in acquiring any purchase from the proceeds of SGR before exploring other markets.

The contract also stipulates that sources of funding for the project shall comprise Self-raised funding by the Government of Kenya,loans under the agreement and the Buyer Credit Loan Agreement.


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