This archive report was first published on 10 June 2020.
Published on June 10, 2020, a report by the Business Daily highlighted a pressing issue affecting the Standard Gauge Railway (SGR) project. The National Assembly's Budget and Appropriations Committee (BAC) has raised a red flag over an unpaid debt of Sh. 38 billion in bills owed to Africa Star Railway Operation Company Ltd, the Chinese company contracted to operate the trains.
Africa Star manages the ticketing system, landing and offloading of cargo, and collection of passenger fares, including non-cash revenues like M-Pesa. The company is majority-owned by China Road and Bridge Corporation (CRBC) and was contracted in May 2017 to run the passenger and cargo trains on the SGR.
Kenya Railways has not paid the Sh. 38 billion to Africa Star, despite the company having the sole right to manage the SGR ticketing system and associated software and hardware. The unpaid bills add to the Sh. 420 billion that Kenya borrowed to build the modern line from Mombasa to Nairobi and purchase of engines and coaches.
According to the report, Kenya Railways has not received any protest letter from Africa Star over the unpaid bills. The company can only foot repair bills of less than Sh. 100,000 under the contract, and is not responsible for any legal claims from third parties involving damage to property, death, illness, or personal injury.
