The country plans to ask China for a longer repayment period on $5bn of loans it used to build a new railway line, transport secretary-designate Kipchumba Murkomen said on Wednesday. Servicing the Export-Import Bank of China (Eximbank) loans, which mature in 15 to 20 years, is choking the economy, Murkomen told MPs at a confirmation hearing in the capital, Nairobi. “If we can manage to renegotiate to 50 years, then it will ease the burden” and enable the government to use money for other parts of the economy, he said. Kenya is at high risk of debt distress and reducing its vulnerability is a central goal of a 38-month International Monetary Fund-supported programme announced earlier this year. The country’s debt stood at 8.58-trillion shillings in June, equivalent to 67.8% of GDP, according to the National Treasury. The rail line, part of China’s Belt and Road Initiative, is Kenya’s biggest infrastructure project since the country gained independence from Britain in 1963. It links Nairobi with the port of Mombasa, East Africa’s largest harbour.
SOURCE: GLOBAL CONSTRUCTION REVIEW
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