Industrial Revolution: Japan and Kenya sign Sh27.3bn deal to build Dongo Kundu Special Economic hub

News & Politics
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Of the Sh27.3 billion, Sh21.36 billion is a long term soft loan while Sh5.969 billion is a grant.

TUESDAY AUGUST 30 2016
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By BERNARD NAMUNANE

Kenya has secured Sh27.3 billion from Japan to construct an industrial and commercial hub in Dongo Kundu, Mombasa. The first phase of the Special Economic Zone (SEZ), which is expected to alter the coastal town in terms of infrastructure and business, is scheduled to be ready by 2019. An agreement signed by the governments of Kenya and Japan on the sidelines of the Tokyo International Convention on Africa Development (Ticad) shows that of the Sh27.3 billion ($269.9 million), Sh21.36 billion is a long term soft loan while Sh5.969 billion is a grant.

“The Government of Japan will finance the basic infrastructure of phase one through a concessional loan of US$210.8 million and grant assistance of US$58.9 million,” the MoU says.

The industrial and commercial hub, which will sit on 1,326 hectares, is part of the master plan for the development of the Mombasa Special Economic Zone that was conceived and prepared with assistance from Japan in 2015. The deal involves the development of infrastructure, including Berth 1 at the Port of Mombasa, access roads, transmission line, water supply pipeline from the mainland and a sub-station, drainage, power supply and a free trade zone in the zone. It will also entail establishment of a free trade zone on between 300 and 500 acres for wholesale and retail trading, breaking bulk, re-packaging logistics, warehousing, handling and storage of goods.

LARGEST EXPORT DESTINATION

The area will be reserved for re-exports to the 400 million-people Common Market for Eastern and Southern African (Comesa), allowing trans-shipment of cargo without inspection or customs duty. The Comesa bloc is the single largest export destination for Kenyan goods, accounting for 35 per cent of the Sh517.9 billion worth exported in 2012. The 17.5 kilometre Dongo Kundu bypass, which starts from Miritini, aims to link Mombasa mainland west to mainland south without passing through the island. It is already under construction. The MoU says Kenya and Japan will “work together to create new employment during phase one consisting of 6,800 direct jobs and to ensure that the works are accelerated and consider all measures to achieve the target of completion of phase one in 2019.” The loan and grant facility are expected to automatically end within a period of three years. To expedite the development of the industrial and commercial hub, the two countries agreed to establish the Mombasa (Dongo Kundu) SEZ Development Agency that will oversee construction work. Within a month, the Office of the President and the Japanese Ministry of Foreign Affairs will form a joint committee co-chaired by Chief of Staff and Head of Public Service Joseph Kinyua and Japan’s ambassador in the country, Mr Tatsushi Terada.

“This committee will oversee the implementation of the areas of cooperation identified under this MoU,” the document says.

Cabinet approved the master plan for the development of the Dongo Kundu Sez in February this year.
However, the process of securing funding took long, forcing the government to delay the ground breaking ceremony.

http://www.nation.co.ke/news/Japan-and-Kenya-sign-Sh27-3bn-deal-to-build-Dongo-Kundu-hub/1056-3362308-bfx70qz/index.html

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Good stuff. I just hope implementation will be smooth.

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http://gadocartoons.com/wp-content/uploads/2016/05/NA.May_.2016.African.Leaders.and_.China_.jpg

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pesa iko mingi sida ni matumisi

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Everything has been put in place purposely to enable quick implementation. It will be directly implemented under the Presidency within a month and with Japan record in Kenya, i’m very excited. 7000 direct jobs, 5.5 billion grant and 28 billion concessionary loan. Don’t worry about the loan, it will pay itself from licence fees alone once the Dongo Kungu SEZ is complete. By that time 100’s of thousand sof jobs will be available in all the plants there and we will be a manufacturing exporting nation then. Wenye wivu can continue hugging a transformer until 2032 na wasichoke, ni mapema sana.

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I see another Konza City

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http://www.4allports.com/images/ports/69/694oi4io4.jpg
The Japanese built this second container terminal in record time, their record speaks for itself. They are also in a race with China over Kenya strategic infrastructure projects. 3rd phase is already underway as from the picture below. Like i said i don’t know how hot it is hugging a transformer and i’m glad i’m not the one doing it.
https://pbs.twimg.com/media/Cnn9LVNXYAAeoSn.jpg

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We should limit the foreign debts we accumulate because they are a burden to the economy.

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Jubilee fanboys believe that the more loans we can get shows that Uhuru is working. In the first two years of Uhuru presidency he borrowed 30% more than Kibaki borrowed in his entire second term. Public debt is through the roof. We have more debt than even that comedy of a country called Tanzania. The president continues to ignore advice from his controller of budget to limit borrowing. Ideally, borrowing is not a bad thing but the corruption in the office of the president ensures that mwanachi will not enjoy even a single cent. Halafu there is no transparency in how these monies are spent, remember eurobond?

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Japan agreed to restructure our debts owed to them in the near term and offset some. Once its spread over longterm, its very manageable for example our revenue collection grows by 15% annually (Kshs 150 billion last year) and we can repay it easily. Two our economy is growing a 6% annually and massive infrastructure projects coming up all over to enable business, growth and commerce. That translates to more revenue, more development and more FDI. Last year alone government repaid 400 billion of debt and was still able to meet recurrent expenditure, development costs and devolution. So as others will cry to see the government they don’t support being successful in all fronts remember development suits everyone whether they like it or not. The industries that will come up at the SEZ will reduce our trade deficit and balance our trade, employ 100’s of 1000’s which means alot of money revolves in the economy, service industry thrive and therefore everyone shares in the benefits. The project is on schedule, finances secured and its time to build as critics do there best domo domo.




[SIZE=6]KEY WORD - READY BY 2019 [/SIZE]

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Niaje CRAZYDUDE aka @spear aka simba 1

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Thank you sana, each day i get elevated. Its a pleasure to be equated with super stars.

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Theodore Roosevelt said, “it is not the critic who counts, not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood, who strives valiantly.” That is how best i can describe Jubilee government and its great development agenda.

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If only politics were to be divorced from development…

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How?

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Political affiliations did not blind people from the job that was done, is being done and will be done by previous, current and future governments in making sure this country goes back to the levels of development we were supposed to experience from independence, it would be good for all to experience and people here to discuss and not be a source of contention and some choosing to use them as bragging rights instead of something this nation actually needs.

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Exactly.

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Concessionary loans zinafaa kukuja, zile tunafaa kufikiria deeply b4 taking ni commercial ones kama Eurobond. And that doesn’t mean they are entirely bad.
For example the concessionary loan given by E.U to construct mai mahiu lanet road a decade ago was well utilised, I bet revenues collected from the expanded towns along that road can comfortably cover the low financing cost

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Exactly, people talk about loans as if it was discovered in 2013. Almost every development project in Kenya was financed by loan since independence. All the roads, power, airports, hospitals, schools, water, etc were built by loans. This government is no exception but at the same time its borrowing concessionary loans to build infrastructure projects that provide more than enough economic growth to pay off the loan, interest and develop the country. Unlike the past the loans aren’t for recurrent expenditure. Jubilee is also aware globalization demands competitiveness and you can not sit back and pray your competition sits down as well. That’s why we are aggressively upgrading the infrastructure starting from the coast heading inlands. Ports, railways, roads, airports, power etc. Those who hate to see the government they dont support making gains home and abroad then that’s entirely your problem. Deal with it how best you can. Kazi itaendelea na hakuna ugonjwa inaitwa too much development.

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mmmmm dongo kundu:eek::eek::eek: