World Bank road loan for Kenya

The World Bank has approved a KES 26 billion (US$ 328 million) loan to Kenya to complete upgrading the Mau Summit to Kisumu section of the Northern Corridor Road and improve electricity distribution.

About KES 20.24 billion (US$ 253 million) will be used to complete the remaining contracts on the Northern Corridor Road section and finance rehabilitation and replacement of infrastructure and public assets damaged during last year's post-election crisis.

The Bank also approved an additional KES 6.40 billion (US$ 80.7 million) to help the Government develop the energy sector by improving electricity distribution to less well-off regions. Only about 18% of the population have electricity in their homes , and in rural areas that figure drops to just 3%.

The move to help Kenya upgrade the pot-holed Mau Summit to Kisumu highway increases the Bank's support for the Northern Corridor Transport Improvement Project (NCTIP) to KES 36.8 billion (US$ million).

The Bank's Executive Board agreed initial financing of KES 16.56 billion (US$ 464 million) for the scheme in June 2004.

The Bank's country director for Kenya, Johannes Zutt said the extra resources would help rehabilitate key sections of the road corridor running between Nairobi and the Ugandan border.

"This road is not just important for western Kenya, but is a vital trade link for neighbouring landlocked countries, including Uganda, Rwanda, Burundi, the eastern Democratic Republic of Congo and southern Sudan," he said in a statement.

Severe bottlenecks along the northern corridor, including destruction during last year's post-election crisis have delayed goods and raised the cost of doing business across.