Kenyan Lawmakers Want More Details on $5B Railway Loan After Contract Partially Released

Some Kenyan lawmakers are demanding to see more documents from a $5 billion loan agreement with a Chinese bank that financed a cross-country railway. The 2011 agreement was shielded from public view until Kenya's transport secretary, Kipchumba Murkomen, released select pages on Sunday.

Critics of the deal with the Export-Import Bank of China that financed the Standard Gauge Railway say those pages show the Kenyan government gave too much legal authority to China, and lawmakers now want to know whether Kenya put up public facilities as collateral in the deal.

One clause says that any major dispute over the railway would be decided in Beijing, not Nairobi, although it is not clear whether that means Chinese officials have the final say in such disputes. 

The documents also show, among other things, that the Kenyan government was legally bound to keep the details of the deal secret.  

Kenyan political analyst Javas Bigambo said compelling the state to conceal such information from the public is unlawful. 

"The non-disclosure agreement as provided for in that contract is in itself illegal, going by the fact that the laws of procurement in Kenya advocate for transparent procurement processes," Bigambo said. 

Another part of the contract mandates that Kenya is not to buy materials for the railway from any country other than China.  

Some legislators believe that important details of the contract, like collateral for the loans, are still missing. 

"The question as to what collateral has been put up against this loan, if it is public amenities, public institutions, public investments that are being put as collateral," said John Kiare, a member of the Kenyan parliament. "It is only right that Kenyans know because there have been rumors that some government institutions are being put up as infrastructure. There was always debate as to whether we have put our airport as collateral for this loan." 

Critics questioned Murkomen's motive for not releasing the entire contract.  

Makali Mulu, a member of parliament, thinks Murkomen disclosed only the routine parts of the deal.  

"In every contract negotiation, the government has a legal person who would normally look at all the clauses and then advise the government whether it's fine to sign," Mulu said. "Every contract there are always the disclosure clauses and dispute resolution clauses and what Murkomen was saying he would release to me was a big joke." 

The roughly 600-kilometer-long railway, which connects the port city of Mombasa with the town of Naivasha 75 km northwest of Nairobi, opened five years ago. Critics say it is underused and has failed to generate the revenue or economic development that proponents of the project envisioned. China accounts for one-third of Kenya's external debt.