Kenyan port safe from Chinese grab- President Kenyatta- The Exchange

31Dec 2018
By Guardian Reporter
Nairobi
The Guardian
Kenyan port safe from Chinese grab- President Kenyatta- The Exchange

President dismissed the notion that China had put the Mombasa port as part of a loan security should Kenya fail to service its loan it owes the Exim Bank of China for the construction on the maiden SGR rail.

Kenyan President, Uhuru Kenyatta.

President Uhuru while addressing a televised press conference promised to put the contract in public for anyone to verify if there was such a clause for the port grab. Reports emerged early December from the office of the Auditor General warning that such a clause exists and warned Kenya would lose the management of the port if the debt is not cleared.

The government borrowed the billions to construct the Mombasa-Nairobi standard gauge railway (SGR), against opposition that the project by China Roads and Bridges Corporation (CRBC), a Chinese State-owned company, could become a white elephant.

“Exim Bank would become a principal over KPA if KRC defaults in its obligations and the Chinese bank exercises power over the escrow account security,” states a management letter sent to the KPA, that Mr FT Kimani signed on behalf of Mr Ouko.

However, the president dismissed this as mere propaganda noting that Kenya was already way ahead in servicing its debts to China. China has also denied having attached Mombasa port as collateral to its funding of the standard gauge railway line.

Chinese Foreign ministry Spokesperson Hua Chunying said in a statement that fears that the port risked being taken over by China should Kenya default on the Sh327 billion loan to build the Mombasa-Nairobi SGR were not true.

The president also affirmed his commitment to borrow more for development purposes rather than for recurrent expenditure. “I will continue to borrow to develop the country,” he said on Friday during the round-table interview with journalists at State House, Mombasa.

“We are opening up roads across the country and a railway line that never existed 50 years ago. The debt we are incurring is for development projects that will not only benefit this generation but future ones as well,” he said.

President noted that Kenya was neither looking east nor west but was ready to work with different countries for the benefit of the economy. He acknowledged that while China had presented a good option for African countries, other countries notably the US have crafted their own response to the Chinese onslaught.