Annuity Financing

During the five years period, the Government aims to construct over 10,000 km of new roads in the country as promised in the Jubilee Manifesto. These new roads will be constructed through public private partnerships. Through this modality, the Government will leverage on private investments and technical management which is considered critical to improving and expanding the service provision besides helping to meet the financing gap in infrastructure development.
The Annuity Financing arrangement approach by the Government aims at constructing over 10,000 kms of new roads costing approximately Ksh 260 billion in the next three years. The following achievement has been made to award contracts for the construction and maintenance of roads under phase 1(2000 kms);-

1. Development of draft EOI (Expression of interest for procurement of Engineering Consulting Services for supervision of R.10.000km Annuity Project
2. Bids for nine (9) lots evaluated (technical & financial) negotiations are on-going before finalization of evaluation process
3. Finalization of payment mechanism (schedule M) & Output Specification REP part 4 Annex 7B completed.

Towards a paradigm shift in the road development initiative, the Ministry proposes to explore alternative pavement options that are suited to the low traffic volume links that are characteristic of the rural road network. The new financing approach will take into consideration the need to provide access, regional equity, regional infrastructure imbalance, stakeholder’s consultation and other socio-economic development patterns envisioned under the new Constitution as well as under the Kenya Vision 2030 aspirations.