Kenya is one of the largest investment countries for the World Bank, with billions of shillings allocated to projects including infrastructure, water, urban development, and regional trade.
The Bank has revealed its top five most expensive projects, each valued at over Ksh39 billion (approximately US$300 million).
According to the report, the goal is to improve service delivery, expand infrastructure, and strengthen governance at the county level.
Furthermore, the Bank’s September 2022 operational brief, “How the World Bank is Supporting Kenya’s Promise of Devolution,” explains both the opportunities and the challenges that come with implementing one of the most ambitious governance shifts in the country’s history.
“Under the upcoming Country Partnership Framework FY23-28, the World Bank will continue to support Kenya’s devolution process in full cooperation and guided by the leadership of the incoming governors and deputy governors,” Keith Hansen, World Bank Country Director for Kenya, notes in the report.
Since the 2013 devolution, which led to the creation of 47 county governments, the report has indicated that the move has been a transformative step toward addressing inequality and ensuring fairer access to resources.
“With devolution, Kenya has made a monumental shift in its system of governance and set the country on a durable path to achieving more equitable development that ensures opportunity for all Kenyans,” the report states.
Moreover, the Bank highlights that devolution came early in Kenya’s path toward becoming an upper-middle-income country, providing strong foundations to avoid common MIC traps, such as low productivity and inequality.
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World Bank Lists Most Expensive Projects in Kenya
The Bank’s most expensive projects in Kenya are primarily focused on infrastructure, regional integration, and urban development.
The most expensive one is the Horn of Africa Gateway Development Project (HOAGDP), valued at Ksh97 billion (US$750 million), which aims to open up transport and trade routes in the north and northeast regions.
Second on the list is the East Africa Regional Transport, Trade, and Development Facilitation Project – Phase Two, with a commitment of Ksh64 billion (approximately US$500 million), and the Eastern Electricity Highway Project, valued at Ksh54 billion (approximately US$441 million).
In devolved operations, two programs stand out, with commitments of Ksh 39 billion (approximately US$300 million) each. The Kenya Urban Support Program (KUSP) and the Water and Sanitation Development Project (WSDP).
The five projects are part of a bigger portfolio of 33 ongoing operations, including 10 devolved projects, 12 geographically focused county projects, and 11 categorized as other operations.
“The World Bank has accompanied Kenya on this journey since the start with almost US$2 billion of financing committed and under implementation in formally devolved operations and another US$3 billion in operations with some geographic focus in counties,” the report notes.
Results of the Million Dollar Investments
The Bank’s interventions have produced tangible results across sectors, including agriculture.
More than 848,000 farmers in 45 counties have been mobilized into 35,000 Common Interest Groups, resulting in yield increases of 23 percent for maize, 16 percent for beans, and 30 percent for potatoes, respectively.
In water and irrigation, access to improved water sources has been extended to 1.6 million women, while irrigated agricultural land has expanded from 143,500 hectares in 2010 to 203,508 hectares as of 2015.
On the other hand, health has also been a major focus with expanded access to basic packages of health, nutrition, and reproductive services reaching 6.7 million people.
The Bank has also financed Kenya’s universal health coverage pilots in four counties, a step toward nationwide rollout.
Urban areas have benefited from the creation of 59 municipalities, the preparation of 57 integrated development plans, and the development of 49 urban spatial plans.
The projects have provided over 3.5 million people with improved infrastructure in towns and cities, catalyzing growth and better planning.
Additionally, with Bank support, counties have implemented the National Capacity Building Framework and achieved a County Annual Capacity and Performance Assessment score of 71 percent, surpassing the target of 55 percent set in 2021.
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The Bank Highlights Challenges of Devolution
On the other hand, the Bank has noted delays in fund flows as one of the biggest challenges, stating that in some countries, resources have been recentralized rather than directed to frontline services.
Procurement processes have also been problematic.
“A shortage of qualified procurement staff and churning on specific procurement processes, occasionally due to outside influences, have been notable factors in delaying project investments,” the report says.
Also, land acquisition is another recurring challenge. Delays have, in some cases, led to penalties and costly contract adjustments.
“While enabling legislation is in place, the registration of community land has been extremely slow, creating a legal void which makes land use agreements for infrastructure investments difficult,” the report adds.
However, to address these issues, the World Bank has been working to improve accountability and transparency with all government agencies, including counties, to access financing through the National Treasury.
The Bank has promoted the creation of Single Fiduciary Management Units (SFMUs) in counties to consolidate financial oversight, while expenditures are audited annually by the Office of the Auditor General.
At the same time, the roll-out of Kenya’s new e-government procurement (e-GP) system at the county level is expected to enhance fair competition, efficiency, and value for money.
The Bank’s Environmental and Social Framework (ESF) also applies to protect people and the environment in projects financed by the Bank.
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