Kenya Could Lose Mombasa Port to China Over Debt




A leaked audit report says Kenya secured a debt to China using Kenya Ports Authority assets, thus sparking fears that China might take over Mombasa Port if the country defaults.

Kenya Could Lose Mombasa Port to China Over Debt
Image: Safety4sea

Reports from Kenya suggest the country could lose Mombasa Port to China if Kenya Railways Corporation defaults in the payment of a loan from Exim Bank of China. The country used Mombasa port to secure the loan which was taken from the Chinese bank to finance construction of the standard gauge railway (SGR).

A leaked audit report shows that the government waived sovereign immunity on the Kenya Ports Assets on signing the agreement with China thus exposing Kenya Ports Authority to foreclosure by China Exim Bank. Further, the report says, “The agreements are biased since any non-performance or dispute with the China Exim Bank would be referred to arbitration in China, whose fairness in resolving the disagreement may not be guaranteed.”

The agreements also provide that the revenue of the Kenya Ports Authority is to be used to clear the debt. The Kenya Ports Authority management was supposed to submit comments on the leaked report within seven days from the 16th of November 2018 but it is unclear if that has happened.

The Auditor General has however refused to confirm or deny the veracity of the leaked report arguing that, “Any reports that from my office are taken to Parliament. A report picked from the social media is not official.” The Kenyan Cabinet Secretary for Transport and Infrastructure has categorically dismissed the report as untrue, saying, “You know this cannot be true, the idea of waiving a country’s sovereignty. So let’s not dwell on it.”

The loan is, however, very real and the East African reports that, “Of the Chinese loan for the Mombasa-Nairobi track, a total of Ksh319 billion ($3.2b) was spent directly on railway construction, with Ksh213 billion ($2.1b) going to SGR and the rest of it being used in buying the rolling stock (locomotives and wagons).”

China is said to have also provided raw materials, engineers and rolling stocks for the SGR project while China Communications Construction Company is involved in the SGR cargo and freight business. In short, China is everywhere and the Kenyan government will have great difficulties convincing anyone that China does not have the legal right to take over the port of Mombasa.

It is not out of character for China to go into such lopsided deals and also not out of character for an African government to vehemently deny their existence. Reports that China was about to take over the Zambian power company made the rounds earlier this year and the country again refuted the claims.

© Africanexponent





Uzonna Anele
Anele is a web developer and a Pan-Africanist who believes bad leadership is the only thing keeping Africa from taking its rightful place in the modern world.

Leave a Reply

Subscribe to receive email updates

With a subscription profile, you automatically receive updates without having to return to the website and check for changes

Just In

The Virginia Killing Act of 1669: the Law That Made It Legal to Kill a Slave

The Virginia casual killing act of 1669 declared that, should a slave be killed as a result of extreme punishment, the master should not face charges for the murder.

The Creation Story of the Akamba People of Kenya

In the beginning, Mulungu the creator is said to have formed a man and a woman in heaven before placing them on a rock in on earth, where it is said that their footprints, as well as the footprints of their animals, can still be seen today.

Bussa’s Rebellion of 1816, the Largest Slave Revolt in Barbadian History

The largest slave rebellion in Barbadian history took place during the Bussa uprising in April 1816. The rebellion takes its name from the African-born...

Top 10 Longest Serving Presidents in Africa, 2022

Equatorial Guinea's president Teodoro Obiang is the longest serving president in Africa and the world. He is closely followed by Cameroons President Paul Biya.

Cornelius Frederiks: the Namibian Captain Who Was Locked Up in a Concentration Camp for Fighting Against German Colonialists

Cornelius Frederiks was a Namibian freedom fighter who actively fought a guerrilla-style war against German colonialists during the Herero-Nama war of 1904.

More Articles Like This