Kenya leapfrogged five countries to become the fourth biggest beneficiary of project- funding from the African Development Bank (AfDB) on the continent in a single year, as the Pan-African lender deepens its financing of projects in Kenya.
New disclosures show that AfDB approved project funding worth 442.5 million Units of Account (UA) or the equivalent of $577.08 million (Sh74.54 billion) for Kenya last year, which was a jump of 52.7 percent from the UA290.4 million or $389.6 million (Sh50.33billion) in 2023, when the country was the ninth biggest beneficiary of disbursements from the lender.
The lender is funding a host of capital-intensive projects in Kenya notably in the energy, roads and water sectors. Kenya trails South Africa, Morocco, and Nigeria in the value of approvals granted by AfDB in a single year.
AfDB has over the years been expanding financing for projects in Kenya as the country grapples with a mounting debt and revenue shortfalls. The lender did not however disclose the share of the UA442.5 million that it disbursed to Kenya.
The lender singled out the Kenya-Ethiopia electricity transmission line as one of the key projects that have been successfully delivered via its funding.
“The Ethiopia-Kenya Electricity Highway project, a co-funded Bank project, is enhancing regional connectivity by integrating renewable energy sources into regional power networks,” AfDB notes in its 2024 annual report.
South Africa was the biggest beneficiary, with approvals worth UA1.09 billion or $1.42 billion (Sh183.44 billion), followed by Nigeria at UA675.7 million or $881.2 million (Sh113.83 billion) and Morocco at UA471.4 million or $614.8 million (Sh79.42 billion). Egypt came fifth at UA395.9 million or $516.3 million (Sh66.70 billion).
Last year’s total approvals by AfDB for the entire continent dropped to UA8.03 billion or $10.47 billion(Sh1.35trillion) compared to $8.47 billion or $11.36 billion(Sh1.09trillion) in 2023.
The AfDB, however, did not disclose the amount disbursed to each country last year. It only revealed that it disbursed UA5.09 billion or $6.64 billion (Sh857.80 billion) which was an increase from UA4.43 billion ($5.94 billion) in 2023.
UA is the official unit of trade of the AfDB and its exchange rate varies against other currencies. For example, last year, one UA was equivalent to $1.304.
AfDB funds projects in three ways; grants, loans, and guarantees. The three can either be sovereign (to government or its entities) to the private sector (non-sovereign).
The Kenya-Ethiopia transmission line spans over 1,000 kilometres and runs from Woloyta-Sodo in Ethiopia to the Suswa substation in Kenya. The line has enabled Kenya to import from Ethiopia under a 25-year deal.
Other notable projects that AfDB is funding in Kenya include the Sh16.7 billion – Kenol-Sagana-Marua road and the 310-megawatt Lake Turkana Wind Power plant in Marsabit County.
AfDB’s involvement in Kenya is set to deepen this year given that applications for project funding by different entities have been approved since the start of this year. For example, in April this year, Kenya Power said that it had secured Sh12 billion for the Last Mile Connectivity project.
