MIGA Provides More Support to Upgrade Kenya’s Road Network
WASHINGTON, February 13, 2023 – The Multilateral Investment Guarantee Agency of the World Bank Group (MIGA) has issued guarantees to Standard Bank of South Africa Limited and Stanbic Bank Kenya Limited totaling $51.44 million to cover loans to Skar Lot 32 Development Corporation Ltd. for the construction, rehabilitation, upgrading, operation, and maintenance of an existing 66.5-km rural road in Kenya.
The guarantees, which became effective on December 23, 2022, cover the banks’ loans against the risks of transfer restriction, expropriation, breach of contract, and war and civil disturbance, for a period of up to 8.5 years. The road will be upgraded from earth/gravel to bitumen.
This is the second road project MIGA has supported in Kenya under the government’s Road Annuity Program, an ongoing program to upgrade up to 10,000 km of roads that will significantly increase the length of asphalt-surfaced roads in the East Africa nation and cut many travel times dramatically.
Similar to other portions of the Kenya Road Annuity Program enabled by MIGA guarantees, the upgrade will include earthworks, concrete works, and drainage works, with climate adaptation measures that include elevated road sections and deeper drains, pipes, and culverts.
“MIGA’s guarantees for the Kenya Road Annuity Program are critical to global climate adaptation efforts that will be needed in coming years to maintain existing roads and build new ones,” said Hiroshi Matano, Executive Vice President of MIGA. “These climate-resilient roads will help to connect people, drive commerce, and support development in Kenya.”
While the newest upgrade will improve road safety, generate travel time savings, and reduce vehicle operating costs, potential benefits will go beyond the drivers and vehicles using the road. Those benefits include the creation of new business opportunities for local shops and vendors, as well as the reduction of poverty by better integrating the local area with the rest of the country, including with key economic centers.
The project is aligned with the World Bank Group’s Country Partnership Strategy for Kenya, particularly in relation to enhanced infrastructure and logistics for sustainable growth and the Kenyan government’s second and third Medium-Term Plans to promote a safe and efficient transport network. MIGA’s support for the project will complement the World Bank Group’s investments in the road sector in Kenya.
About Standard Bank of South Africa Limited
Standard Bank Group is the largest African bank by assets, operating in 20 African countries and five global financial centers. Headquartered in Johannesburg, South Africa, Standard Bank is listed on the Johannesburg Stock Exchange with share code SBK, and the Namibian Stock Exchange with share code SNB. For further information, go to http://www.standardbank.com
About Stanbic Bank Kenya Limited
Stanbic Bank Kenya is a member of Standard Bank Group. It provides a full spectrum of financial service to the people of Kenya, including personal banking products and solutions, insurance, investment, fiduciary, bespoke banking, and multi-generational wealth preservation solutions to individuals, business, commercial, and corporate clients across the bank’s footprint.
About MIGA
MIGA was created in 1988 as a member of the World Bank Group to promote foreign direct investment in emerging economies by helping to mitigate the risks of restrictions on currency conversion and transfer, breach of contract by governments, expropriation, and war and civil disturbance; and offering credit enhancement to private investors and lenders.
Since its creation, MIGA has issued nearly $70 billion in guarantees across 122 developing countries in support of nearly 1,000 projects.
Contacts:
In Washington:
Elizabeth Howton, (202) 458-5922, ehowton@worldbankgroup.org
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