This archive report was first published on 13 June 2020.
On June 11, 2020, Treasury CS Ukur Yatani presented the Sh2.79 trillion budget, highlighting the need to rectify the dominance of foreign companies in Kenyan infrastructure construction projects.
The government aims to give local contractors a key role in utilizing the Sh172.4 billion set aside for infrastructure projects in the new financial year.
Presenting the budget, Yatani acknowledged that foreign companies had largely benefited from Kenyan infrastructure construction projects, with China being the single largest financier of the country's infrastructural projects.
Kenya is set to spend Sh904 billion on debt repayment to China, and the government aims to rectify this by introducing a minimum tax payable by all companies at one per cent of their gross turnover.
Contracts for mega government projects, including rail and roads, have been awarded to Chinese companies, but the government plans to review its contracting framework to boost the role of local contractors.
The Sh172.4 billion set aside in the budget for infrastructure will cater for roads, railways, ports, and airports, with Sh18.1 billion allocated for SGR Phase 2, Sh6 billion for the LAPSSET project, and Sh5 billion for the Mombasa port development project.
