According to the report, Arror Dam has total arrears of Ksh. 2,861,297,485, Kimwarer Dam Ksh. 2,829,599,065 while the Itare Dam project holds Ksh. 5,348,242,211. The default on debt repayment exposes the Government to risks of legal suits that may lead to punitive penalties and subsequent loss of public resources
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The announcement by President William Ruto that the Construction of the Arror and Kimwarer dams in Elgeyo Marakawet County is to resume has been met with mixed reactions. The two mega projects were cancelled by former President Uhuru Kenyatta in 2019 after investigations unearthed a scandal where billions of shillings were paid to an Italian firm for no work done. The Weekly Vision has learnt that taxpayers’ money amounting to Ksh. 11 billion will be used to pay interest on the defaulted loans.
According to records, the National Treasury’s Commonwealth Secretariat Debt Recording and Management System as of 30th h June 2022 reveals how the Government had defaulted on servicing an amount of Ksh. 11,039,138,761 in respect of 3 loans advanced by an International Commercial Bank towards the construction of the dams.
According to the report, Arror Dam has total arrears of Ksh. 2,861,297,485, Kimwarer Dam Ksh. 2,829,599,065 while the Itare Dam project holds Ksh. 5,348,242,211. The default on debt repayment exposes the Government to risks of legal suits that may lead to punitive penalties and subsequent loss of public resources.
In the meantime, several parastatals with outstanding balances amounting to Ksh.14, 566,060,517 as of 30th June 2022 have not shown a willingness to pay the loans. The companies are Miwani Outgrowers Mills Limited Ksh. 6,600,000, Miwani Sugar Company (1989) Limited Ksh. 16,000,020, Miwani Sugar Mills Limited Ksh. 78,088,180, Mombasa Pipeline Board Ksh. 22,964,980, Mumias Outgrowers Company Limited Ksh. 16,517,400, Mumias Sugar Company Limited Ksh. 3,000,000,000, National Water Conservation and Pipeline Corporation Ksh. 2,460,874,897 and Uchumi Supermarkets Limited Ksh. 1,200,000,000.
Further, there are 12 loans amounting to Ksh. 13,151,255,401 which had no movement during the year and have remained unpaid over a significant period. The companies are Agro-Chemical and Food Company Limited Ksh. 2,941,884,000, East African Sugar Industries Limited Ksh. 177,132,100, Kenya Meat Commission Ksh. 940,241,100 and National Irrigation Board Ksh. 2,262,036,544.
