Kenya’s humongous appetite for Chinese loans is nearing the trillion mark as the government seeks to borrow money for the construction of Phase 2B of the SGR that will link Mombasa to Malaba.
Indeed, Kenya Railways acting director said that the preparations for the loan were currently ongoing.
Additionally, China has confirmed to the media that the loan would be issued to the Kenyan government in terms of concessions and hard loans.
While addressing the press on the current happenings of the SGR project, kenya Railways Corporation acting director Phillip Mahinga said that the government was in talks with China to increase the fundings for the 974 kilometer-long railway that would be accessible for passengers as well as the transportation of goods.
The amount to be borrowed would be Kshs 327 billion from the China’s Export-Import Bank of the United States (Exim).
Nevertheless, a large number of Kenyans have been concerned that the government will be unable to repay back the loans and hence, lose some of its vital assets to Beijing, including its highly coveted Mombasa Port.
As a matter of fact, a report disclosed in January has shown that Kenya has plenty of strategic assets tied to SGR loans.
In the event that Kenya would default on the loans, all the assets would be surrendered to the Chinese government because Kenya gave China sovereign immunity while putting pen to paper in the 2014 deal.
The loan will now stand at $8 billion, a billion shy from Rwanda’s GDP in 2017 which was at $9 billion