Kenya to launch National Infrastructure Fund to cut reliance on external borrowing

Kenya is poised to establish a national infrastructure fund aimed at financing major projects such as roads, dams and power generation, in a move that will reduce the country’s reliance on external borrowing and ensure sustainable local development.

According to President William Ruto, the initiative will help the government tackle funding gaps that have stalled critical development projects. He noted that raising sufficient funds for major infrastructure projects has become increasingly difficult, prompting the administration to explore new local financing mechanisms.

“For long, we have been building roads which end up stalling due to lack of funds. For Kenya to grow, we must do things differently,” he said during a church service at St. Mary’s AIPCA Church in Kathelwa, Igembe Central, Meru County, on Sunday.

The President noted that he is engaging Members of Parliament to support the creation of the fund.

The infrastructure fund, Ruto said, will enable the government to complete stalled projects, initiate new ones and expand power generation capacity to 10,000 megawatts.

“In Meru alone, we need about Sh40 billion for water projects, yet the entire country has secured only the same amount. We have done a lot to lay the foundation in the last two years, but we must up our game. I have told MPs that Kenya should not be at the level of a third-world country,” he said.

The President also accused opposition parties of fuelling negative politics and early campaigns that distract from development.

“Kenya was left behind by countries like Singapore because of bad politics. My government has done a lot in the last two years, but we can do more. Do not be lured into early campaigns by people who have no agenda,” he said.

He dismissed political slogans targeting him, saying, “I have listened to my opponents and what they have is empty noise. The political sloganeering like ‘Ruto must go’ and ‘one term’ are of no value.”

Ruto announced that Meru town will be elevated to city status, making it Kenya’s sixth city, alongside the allocation of Sh7 billion to redesign the Nithi Bridge, which has been a safety hazard for nearly two decades.

“We want to straighten the Nithi Bridge so that it stops being a trap where citizens lose their lives and experience many accidents,” he said.

He further revealed that Sh2 billion has been set aside for the construction and rehabilitation of roads in Meru County, assuring residents that the projects will now proceed after delays caused by economic slowdown and inflation in 2022.

“Now we have a funded plan for roads over the next two years. This will ensure our roads are safe,” he said.

To support Meru’s transition to city status, the government, in collaboration with the World Bank, has allocated Sh5 billion for a 10-kilometre road and bypass network. In addition, Sh800 million will go towards building 17 modern markets, and Sh1 billion for upgrading Meru Level Five Hospital. A state lodge is also expected to be completed by December this year.

“This is why we have allocated Sh800 million for modern markets and Sh1 billion for Meru Level Five hospital. We also have Sh5 billion for upgrading 17 kilometres of Meru town roads, including bypasses. I have also instructed my officers to ensure we have a state lodge in Meru by December,” he said.

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On housing, Ruto said 2,000 affordable units have been completed in Meru County, with plans for an additional 8,000 pending land acquisition.

“We need land to build more housing units. Sh33 billion was allocated for housing in Meru; Sh21 billion has been used, and Sh12 billion remains,” he said.

The President highlighted education and electrification as key pillars of his development agenda, noting that the government has employed 100,000 teachers and built 23,000 schools to ensure all children access quality education.

“Education is empowerment. No child in Kenya will miss school,” he said, adding that university and technical college fees have been reduced by 14 to 15 per cent, with students from poor backgrounds paying Sh10,000 per term.

Ruto also revealed that Sh2 billion has been earmarked for rural electrification projects in Meru County, targeting 26,000 households.