Infrastructure

Chinese Firm Wins Sh38bn Tender for Lamu Port Berths

The first three berths in the port of Lamu will be completed in three years.

Updated on

April 20, 2013

Lamu Port Kenya — Lamu Port will be ten times bigger than its Mombasa counterpart. PHOTO | FILE

China Communications Construction Company has won a Sh38 billion tender to construct the first three berths at the port of Lamu, according to a senior Kenyan official.

Silvester Kasuku, chief executive of the Lamu Port-South Sudan-Ethiopia (Lapsset) corridor project said Thursday that a consortium of companies led by China Communications had won the tender, signalling the start of the multi-billion shilling project.

“We called for contractors and the best was a consortium headed by China Communications,” Mr Kasuku told Reuters in Nairobi.

“We are doing the seed investment by constructing the first three berths just to break the ground and put government commitment and investment and provide incentives for private sector investors to come on board,” he said.

Mr Kasuku said the first three berths in the port of Lamu will be completed in three years during which the government will be preparing a business plan for how private investors can be involved, with private-public partnerships (PPPs) and joint ventures seen as possible models.

Lapsset corridor project, a Sh2 trillion infrastructure development, aims to link South Sudan and Ethiopia to the Lamu port by building a superhighway, a railway, and an oil pipeline. The project will be completed within 17 years.

According to the project’s master plan, Lamu Port will comprise 32 berths upon completion of the Lapsset corridor project in 2030.

Kenya is seeking foreign investors and governments to help finance the project. The Development Bank of Southern Africa (DBSA) has already shown interest in financing the project to the tune of Sh127 billion.

“We are interested in the project (Lapsset) and are keen to be a lead arranger,” said DBSA spokesman Jacky Mashapu.

Lapsset corridor project is expected to add about 3 per cent to the Kenyan GDP and critics call it a ‘vanity project’ saying that the trillions of shillings would do a better job upgrading the country’s existing infrastructure.