There is a bullish mixed-use development along Chiromo road, more controversial than the entire ten years of the Jubilee government’s administration. There is even better access to the establishment from Muthithi road, for those who may wish to tour this magnificent set of skyscrapers. I must warn you though, each of its beams and columns stinks of high-level corruption. The Global Trade Center (GTC) center has been developed in a lot of secrecy. Little is known of real owners of the massive investment, but a closer look at the property is enough to tell you something is off about it.
In a broadcast panel discussion dubbed “ODM tax policy dialogue” featuring Prof. Ngotho wa Kariuki, ODM’s executive director Oduor Ong’wen on Wednesday claimed the GTC center is owned by contractors of the botched Greenfield Terminal project at the JKIA.
Anhui Construction Engineering Group Ltd (ACEG) and China Aero-Technology International Engineering Corporation (CATIC) were contracted to build the Greenfield Terminal at JKIA but ended up raising a private mega-project in Chiromo – courtesy of tax-payers money.
Breach of contract
The two Chinese companies supposedly received 21.9 billion shillings as compensation (17.6 billion-plus initial payments of 4.3 billion) for the abandoned JKIA Greenfield Terminal project. The Greenfield terminal project was expected to improve the international airport’s passenger handling capacity, to more than 20 million passengers per year. It was designed to cover 178,000 square meters and upon completion would have 50 international check-in counters, eight air bridges for aircraft to dock, 45 aircraft parking stands, and an additional runaway.
In March 2016 President Uhuru Kenyatta ordered the cancellation of the project.
Insiders claim Uhuru’s cancellation was a result of the government failing to mobilize commitment funds equal to 15% of the value of the project, an amount which then translated to 9,713,153,148.80 shillings. These funds were meant to unlock funding for the project from a number of local and foreign banks including the African Development Bank (AfDB).
At that point members of the transport committee of the National Assembly questioned the prior payments and the 17.6B compensation, but nobody questioned the sincerity of the government in failing to raise 9.7 billion shillings.
Mealy mouthed regime
At the time of cancellation of the multi-billion project, government officials issued contradicting statements on the real reason why the project was canceled. Then KAA managing director, Jonny Anderson sent an outrageous statement to newsrooms alleging the project had been stopped as a result of excess capacity which had resulted from the expansion of the existing facilities at the JKIA.
However, Transport CS, James Macharia contradicted the KAA boss, alleging that the cancellation was informed by a study highlighting the terminal would yield “no value for money”.
“We have stopped the Greenfield project because it has no value for money. We would rather spend that cash building a second runway as opposed to a new facility,” CS Macharia told the Business Daily in May 2018.
A day later while being grilled in parliament by the transport committee, Mr. Anderson added that the authority would not advance any compensation to the Chinese contractors but would instead seek a refund of the 4.3 billion shillings which had already been paid to the Chinese companies.
Denial and secrecy
Even the then-Attorney General Prof. Githu Muigai insisted the two Chinese companies were not entitled to any compensation. I may not be a legal scholar and may understand very little about business law but I can figure out breach of contract and repercussions of the same.
To date, no government entity or press has authoritatively issued a breakdown to divulge information, on whether or not the two Chinese companies were compensated as demanded. Furthermore, the government has never discussed the progress of the negotiations that succeeded in the deadlock between KAA and the Chinese contractors.
Kenyans, however, must ask some critical questions.
How did a project whose feasibility study was partly conducted by Africa Development Bank (AfDB) and approved by it in April 2015 turn out to be of “no value for money” less than a year later?
How did the government fail to secure a 9 billion shilling guarantee to secure the completion of the Greenfield Terminal? How come the Chinese contractors were allowed to invest in Kenya even after their tussle with KAA? Which high-ranking government officials benefitted from the cancellation of the tender and Who are the Kenyan partners in the GTC center project?