American contractor Bechtel, which was contracted to construct the Ksh300 billion Nairobi-Mombasa Expressway has rejected a government offer to recover its money from toll fees.
In the initial plan, the contractor was to recoup their investment by charging motorists toll fees, until the whole amount was recovered.
However, according to the Parliamentary Budget Office (PBO), the contractor has rejected the offer and wants to be paid directly from government coffers.
According to a study by Inter-America Development Bank, the initial plan is only viable if at least 5,000 vehicles use the road per day.
“This limits the number of roads that can be undertaken by the model in Kenya to a few sections of the main transport corridors. Along the A8 (Malaba – Eldoret – Nakuru – Nairobi – Voi – Mombasa) road, the Nairobi Expressway has so far proved to be a viable section for tolling while the Mombasa – Nairobi Expressway has proved difficult,” PBO said.
Read: US Delays Funding Of Nairobi-Mombasa Highway Dualing Over Kenya’s Debt Burden, Possible Overpricing
“The contractor has indicated that the country will get better value for money if the road is constructed under an EPC (Engineering, Procurement and Construction) model rather than a toll model.”
If the government goes for an alternative of public-private partnerships (PPP), the road would cost five times more at $15 billion (Ksh1.5 trillion) and more time would be required for completion.
The road, whose idea was birthed in 2015 and a contract signed in August 2017, is designed to have two lanes on either side and run parallel to the current Nairobi-Mombasa Road.
Toll fees were introduced in Kenya in the late 1980s but were scrapped in the mid-1990s. Instead, Kenyans pay the toll fees through the roads maintenance levy currently charged at Ksh18 per litre of petrol and diesel.
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