Thursday, June 20, 2013

State to borrow 50 000 000 000 for first phase of Konza

Information and Communications PS, Bitange Ndemo has disclosed that the State is in talks with Brazil, Russia, India and China to acquire Sh50.5 billion to fund the first phase of Konza Techno City. Photo/FILE
Information and Communications PS, Bitange Ndemo has disclosed that the State is in talks with Brazil, Russia, India and China to acquire Sh50.5 billion to fund the first phase of Konza Techno City. Photo/FILE  NATION MEDIA GROUP
By Okuttah Mark

Posted  Tuesday, June 18  2013 at  19:43
The government intends to borrow Sh50.5 billion ($600 million) to fund the first phase of Konza Techno City scheduled to start in December.
Information and Communications PS Bitange Ndemo said the concessional loans being negotiated with Brazil, Russia, India and China would finance roads, railway, telecommunication, water and sewerage systems within the 5,000-acre technology park.
“There is an already worked out plan to seek $600 million concessional loan from the BRIC to fund the onsite and offsite infrastructure projects,” Dr Ndemo said in an interview with the Business Daily.
The Sh1.3 billion allocated in the Budget will be used to construct a building that will host government offices and to pay consultants.
The development model puts third parties at the centre of its execution, with the government offering the land and backing legal and architectural plans.
The government is also tasked with building infrastructure within and leading to the city. It has started digging five bore holes at the site, putting a police post and is expected to build a power station and contract Thwake dam for water supply.
When complete, Konza is expected to employ 16,200 workers. The first phase is set for completion in 2017.
China has taken advantage of the  increased demand for concessional loans by African countries and has announced it will increase the amount available to Africa.
The recently concluded Fifth Forum for China-Africa Cooperation adopted the Beijing Action Plan for 2013-2015 that will provide African countries with $20 billion as concessional loans for the development of infrastructure, agriculture and manufacturing, double the amount pledged in 2010.
Konza will host international and local business process outsourcing (BPO) companies, a science park, a convention centre, shopping malls, hotels, international schools and health facilities.
The government is offering the investors a 99-year lease, with a 25-year payment plan. The arrangement is to be reviewed after a decade with the Treasury remaining custodian of the land.
Firms that have shown interest in the project include Safaricom, Wananchi Online, Kenya Medical Research Institute, the University of Nairobi, the Jomo Kenyatta University of Agriculture and Technology and the Nairobi Hospital.


Dr Ndemo also disclosed that Huawei Technologies of China, Korean electronics giant Samsung, Telemac of the US and Canada’s Research In Motion are in the list of foreign firms that have expressed interest in the technopolis project.
Others are Google, Craft Silicon, Telemax Technology Corporation of Taiwan and Shapoorji Pallonji Group from India.
mokuttah@ke.nationmedia.com

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