Kenya is at the verge of losing Ksh7.2 billion on the constructions of Galana Kulalu model firm as the project has stalled.
According to reports, an Israeli company which was contracted to build the firm has for months now downed their tools despite the promises that they would resume work.
The contractor, Green Arava, had been paid Ksh5.9 billion which constitutes 80 percent of the total amount required for the completion of the project.
The Israeli firm is allegedly packing its tools following constant miscommunications between them, the National Irrigation Board (NIB) and the government.
The project, which was to I President Uhuru Kenyatta’s plan of ensuring food security in the country, is stated to have been financed by the government and an Israel bank known as Bank Leumi, which offered the Kenyan government a loan of Ksh6.35 billion towards the project on condition that the Israeli firm be chosen to work on it.
In several documents seen by a local daily, Green Arava accuses NIB of failing to honor requests for payments before threatening to stop any further work until all its requests for payments are addressed.
On the other hand, NIB accuses the contractor of going rogue, failing to respond to numerous letters, demobilizing from the construction site contrary to contractual obligations, and embarking on a go-slow.
“We have reached a point of no return. We cannot continue with more payments for work whose progress we are not pleased with. We have written to the National Treasury so that they can advise on a way forward,” Charles Muasya, the head of design and planning of irrigation projects at the National Irrigation Board stated.
Following the sour relations between the parties involved, the NIB drafted a letter to the National Treasury and the Attorney General asking for intervention.
“We have resolved to disengage with Green Arava. Consequently, we need guidance if the unspent funds can be given to another contractor to complete the works. As we wait for guidance, we will continue to charge the contractor Ksh10,000 per day as liquidated damage for failure to complete the project in time,” Mr Muasya noted.
Reiterating his sentiments, the CEO of NIB, Gitonga Mugambi, wrote to Irrigation PS, Fred Sigor, asking to disengage from the contract between the government and Green Arava.
The project, which was the brainchild of former Machakos Senator Johnson Muthama, started in 2015, with the first harvest of maize being in January 2016.
Despite the billions pumped into the project, it is unclear what the future of the project will be.