Lobby group wants court to jail State officials for refusing to make public SGR loan contracts

By , K24 Digital
On Wed, 31 Jan, 2024 21:59 | 3 mins read
A train leaves the Nairobi terminus of Mombasa-Nairobi Standard Gauge Railway (SGR) in Nairobi, Kenya, on May 31, 2018. PHOTO/Xinhua

Okoa Mombasa has asked the High Court to jail government officials for declining to make public the loan contracts related to the construction of Kenya’s Standard Gauge Railway (SGR).

An application filed in court by the lobby group through two activists Khelef Khalifa and Wanjiru Gikonyo wants the court to jail two Principal Secretaries Chris Kiptoo (National Treasury and Planning) and Mohamed Daghar (State Department for Transport) for six months for deliberately disobeying court orders issued on May 16, 2022.

"We argue this court does issue summons to the Principal Secretaries Kiptoo and Daghar to appear before the Court on a date to be determined, to show cause why they should not be committed to jail or penalized for contempt of court," the two activists seeks.

The duo accuse the government officials of bluntly defying court orders issued by the then High Court Judge John Mativo to release the loan contracts for its Chinese-built Standard Gauge Railway.

According to the petitioners, they have made several follow-ups and reminders with the government officials to release the information sought and to comply with the said decree and orders of the Court but the two PSs have persistently failed and or refused to act in obedience to the orders.

"The act of the Respondents refusing to heed to the orders of the Court is purely on the basis of the position which they presently hold and the interest of justice in the circumstances of this case may require that the Court issue a suspended sentence to Chris Kiptoo and Mohamed Daghar," the petitioners stated in their court papers.

Khalifa and Gikonyo are seeking to obtain all contracts, agreements, and studies for the construction and operation of the SGR.

Okoa Mombasa has been attempting since 2019 to obtain the SGR documents through Access to Information Act requests, but the government has refused, citing confidentiality clauses and issues of national security.

Further, the duo argued that they made the move after the government directed that all containerized cargo at the Port of Mombasa be transported inland through the SGR.

This was a move that had a negative impact on the Kenyan Coast’s port-based economy as it forced logistics companies to move their operations to container depots in the country’s interior.

“We have a right to know the details of the project: how our money is being spent, the consequences of a loan default, and the government’s decision-making processes in signing the deal. Right now, we know none of this – the Kenyan public is completely in the dark," Khalifa said.

The contracts, which date from 2012 to 2013, were executed by the Kenyan government, the China Road and Bridge Corporation and the Export-Import Bank of China.

Okoa Mombasa says Ministry of Roads and Transport Cabinet Secretary Onesimus Kipchumba Murkomen released a limited number of SGR financing documents in November 2022, but those documents did not include the three agreements.

They include the EPC Turnkey Commercial Contract between Kenya Railways Corporation and China Road and Bridge Corporation (Construction of the civil works of the Mombasa-Nairobi SGR project) signed in July 2012.

The contract between Kenya Railways Corporation and China Road and Bridge Corporation (for the supply and installation of the facilities, locomotives and rolling stock for the Mombasa-Nairobi SGR project) was signed in October 2012.

In addition, a Memorandum of Understanding (MoU) on the Mombasa-Nairobi SGR project between the Government of Kenya (represented by the Treasury) and the Export-Import Bank of China was signed in August 2013.

“This release of these SGR contracts is important because Kenyans have a right to know how our taxes are being spent,” Khalifa of Okoa Mombasa says.

“We also have a right to participate in decisions about how our taxes are spent, and to hold our government accountable. We can’t participate if we don’t have adequate information.”

Built at a cost of more than $4.7 billion, SGR is Kenya’s most expensive infrastructure project.

Since its inception, the project has been marred by accusations of being overpriced and damaging to the environment. It’s also been criticized for being highly unprofitable.

The 453-mile track connects the country’s capital, Nairobi, with the port city of Mombasa and the Rift Valley town of Naivasha.

Construction began in 2014, with the primary contractor being the China Road & Bridge Corporation (CRBC) and most of the funding coming in the form of loans from the Export-Import Bank of China.

Passenger and cargo trains operate on the SGR, with passengers welcoming it for reducing travel time when compared to using buses, but cargo owners are avoiding it for reasons including higher fees and more time in clearing goods when compared to using trucks.

Critics worry about its debt burden on Kenya, its financial viability, and the environmental impact. The Africa Star Railway Operation company, a CRBC subsidiary that operates the railway’s passenger and cargo service, has never made a profit in the four years of the SGR’s operation and Kenyan taxpayers have had to fill the gap to sustain the company’s operations.

Environmentalists, meanwhile, say the construction and operation of the railway, which passes through key wildlife areas such as national parks, has destroyed and degraded important ecosystems.

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