This archive report was first published on 20 June 2020.
On June 20, 2020, the Court of Appeal in Kenya delivered a ruling that has significant implications for the country's debt to China. The court declared that the Standard Gauge Railway (SGR) project was procured unconstitutionally, violating provisions of the Public Procurement and Disposal Act of 2005.
The ruling was made in a case filed in 2014 by activists Okiya Omtatah and Wycliffe Gisebe Nyakina, who argued that the procurement process for the SGR project was flawed. The court agreed, stating that the Kenya Railways Corporation failed to comply with the law.
The SGR project has been a contentious issue in Kenya, with many questioning the country's ability to repay the debt to China. The project's cost has been estimated at nearly Sh500 billion, making it one of the largest debts owed by Kenya to a foreign country.
Professor Minxin Pei, a nonresident senior fellow of the German Marshall Fund of the United States, had previously argued that African countries might refuse to pay back Chinese debts due to the disruption caused by the COVID-19 pandemic and in the oil sector.
President of the Law Society of Kenya, Nelson Havi, has criticized the ruling, suggesting that the Kenyan government might be preparing to plead illegality in order to avoid paying back the debt.
Kenya's debt to China is a significant concern, and the ruling on the SGR project has raised questions about the country's ability to repay its debts. The implications of this ruling are far-reaching and will likely have significant consequences for Kenya's economy and its relationship with China.
