President Uhuru Kenyatta’s led the Kenya delegation in seeking an additional Sh370 billion ($3.59 billion) loan from China to extend the standard gauge railway (SGR) from Naivasha to Kisumu.
The money will finance the construction of the third phase of the SGR, a 270km-line between Naivasha and Kisumu escalating the entire cost of the project to Sh847 billion not including the interest charged.
The president will on Tuesday lead the Kenyan delegation in making a formal request for additional funds from Exim Bank of China.
“The funding request will undergo normal procedure of approval and Premier Li (Keqiang) has promised to give it the adequate consideration and urgency it deserves,” State House Spokesman Manoah Esipisu told reporters in Beijing, where the President has been attending a trade conference.
This means that once the deal is sealed every Kenyan is set to owe China Sh18,413 in SGR debt.
Currently, Sh327 billion has been used on the first phase of the SGR between Mombasa and Nairobi and Sh150 billion on the Nairobi-Naivasha section.
The Chinese loan used on the SGR is expected to cross the Sh1 trillion marks by the time the Kisumu section is extended to Malaba, a distance of 107 kilometres, according to Kenya Railways.
Though criticized by some economists for creating a huge debt, President Kenyatta argued that the railway line will open up Africa to integration and expand trade.