Active Development AidData Chinese Aid

China Eximbank provides RMB 1.225 billion government concessional loan for Konza Data Centre and and Smart City Project

¥1.23M RMB

Funder	Export-Import Bank of China (China Eximbank)
Recipient Organization	Government of Kenya
Country	Kenya
Start Date	Apr 26, 2019
End Date	Jul 24, 2030
Duration	4,107 days
Number of Grantees	1
Roles	Recipient
Data Source	AidData Chinese Aid
Grant ID	`59366`

Grant Description

China Eximbank provides RMB 1.225 billion government concessional loan for Konza Data Centre and and Smart City Project In 2017, Huawei Technologies Co., Ltd. and the Government of Kenya’s Ministry of Information, Communication and Technology (ICT) proposed the Konza Data Centre and and Smart City Project as part of a larger Konza Technology City (also called Konza Technopolis) initiative.

Konza Technology City was first proposed in in 2008 as part of a Kenya Vision 2030 and began construction in 2013.

Then, on April 26, 2019, China Eximbank and the Government of Kenya's Ministry of Finance signed an RMB 1,225,000,000 (Ksh 17 billion) government concessional loan (GCL) agreement for the Konza Data Centre and and Smart City Project.

📋 Loan / Grant Terms

📅 Maturity19.5 years

⏳ Grace Period7 years

💹 Interest Rate2%

The proceeds of the loan are to be used by the borrower to finance a commercial contract with Huawei Technologies Co., Ltd, which was signed on June 22, 2017.

The lender made disbursements worth RMB 90,653,760.44 between July 1, 2019 and June 30, 2020 (Fiscal Year 2019-2020), RMB 131,870,086.70 between July 1, 2020 and June 30, 2021 (Fiscal Year 2020-2021) and RMB 247,718,790.85 between July 1, 2021 and June 30, 2022 (Fiscal Year 2021-2022).

The loan’s amount outstanding was RMB 90,653,760.44 as of June 30, 2019, RMB 222,523,847.14 as of June 30, 2020, RMB 354,393,933.84 as of June 30, 2021, and RMB 602,112,724.69 as of June 30, 2022.

The purpose of the project is to construct a National Cloud Data Center, Smart ICT Network, Public Safe City and Smart Traffic Solutions, and a Government Cloud and Enterprise Service.

The project site is located approximately 61 km from Nairobi, 51 km from Kenyatta International Airport (JKIA), and 400 km from Mombasa. Huawei Technologies Co., Ltd. is the EPC contractor responsible for implementation.

According to the Government of Kenya's Electronic Project Management Information System (e-ProMIS), the project had a planned starting date of October 1, 2019 and a planned end date of June 30, 2022. However, it has faced a number of implementation delays.

As of December 2018, Reuters reported the Konza Technology City had still no completed the construction of the first building. However, as of March 2019, construction of the first building was reportedly 90% complete.

Then, on July 23, 2020, Phase I of Konza Technopolis Data Center was completed, and Kenya government ministries and other agencies announced that they would migrate their data, whose services will also be available for private entities as part of a commercialization plan.

The project is currently focusing on the development of infrastructure, which is approximately 50% complete and is expected to be finalized by December 2021.

Progress has been made on the construction of roads, a utility corridor, and the installation of a water reclamation system.

📋 Staff Comments

The Chinese project title is 孔扎数据中心和智慧城市项目.
The e-ProMIS ID number for the Konza Data Centre and and Smart City Project is 058131.
Some sources suggest the the loan agreement was signed on April 19, 2019, during the ‘One Belt, One Road’ Summit Cooperation Forum, rather than on April 26, 2019. This issue warrants further investigation.
The loan identification number in the National Treasury’s public debt register is 2019006 (2019006_1).
The amounts outstanding, disbursements, and repayments data are drawn from the Kenyan Treasury’s External Public Debt Register. See https://www.dropbox.com/s/549ixt2gj1jbjvi/External-Public-Debt-Register-as-at-End-June-2022.pdf?dl=0 and https://www.dropbox.com/s/0et4jg1qfg1bo7r/External-Public-Debt-Register-as-at-End-June-2021.pdf?dl=0 and https://www.dropbox.com/s/233j706743q7f1g/External-Public-Debt-Register-as-at-End-June-2020.pdf?dl=0 and https://www.dropbox.com/s/qkoybr9ja0ohemy/External-Public-Debt-Register-as-at-End-June-2009.pdf?dl=0 and https://www.dropbox.com/s/thy3s6ggjcjd97z/External-Public-Debt-Register-as-at-End-June-2012.pdf?dl=0 and https://www.dropbox.com/s/fzbfq01vas6m0i9/External-Public-Debt-Register-as-at-End-June-2019.pdf?dl=0 and https://www.dropbox.com/s/ennrl6d4zd2nizs/External-Public-Debt-Register-as-at-End-June-2018.pdf?dl=0 and https://www.dropbox.com/s/8ibazrj1a8oho2d/External-Public-Debt-Register-as-at-End-June-2017.pdf?dl=0 and https://www.dropbox.com/s/wdbjl0wq49i09x1/External-Public-Debt-Register-as-at-End-June-2015.pdf?dl=06. This record has been marked as having evidence of financial distress because it was part of the debt restructuring agreements captured in records #92667 and #92668.

📚 Sources & References

Kenya secures funds for Konza
JKIA-James Gichuru expressway projects
中国进出口银行与多国政府及企业签署项目贷款协议
華為項目落址肯雅科技城，6年來科技城第一棟樓仍未完工
Huawei to build Konza data center and smart city in Kenya, with Chinese concessional loan, [2019/058131]- KONZA DATA CENTRE AND SMART CITY FACILITIES
CORRECTED (OFFICIAL)-UPDATE 1-Kenya secures $666 million from China for tech city, highway
SAIS-CARI Loans China
THE EXPORT-IMPORT BANK OF CHINA ANNUAL REPORT 2019
PRESS STATEMENT
External-Public-Debt-Register-as-at-End-June-2020.pdf
Audit flags Sh4.4bn Konza smart city job payment
Konza Technopolis project timeline and latest news as of Jan 26th, 2022
Konza National Data Center and Smart City facilities project
MOFCOM Investment Guide 2019
KONZA DATA CENTRE AND SMART CITY FACILITIES
华为项目落址肯尼亚科技城，6年来科技城第一栋楼仍未完工原文網址：https://kknews.cc/tech/r5oxqgx.html
State borrowed billions to pay debts, says report borrowing spirals debt to Sh208b
Budget Statement Yr 2020-2021
Auditor General Raises Red Flag Over Sh4.4 bn Payment for Konza City
International Cooperation
The National Treasury Public Debt Management Office Summary Statement 2021/2022
SUMMARY STATEMENT OF PUBLIC DEBT FOR 2020/2021FY IN FOREIGN CURRENCY Loan applications and disbursements are still being received and processed as the projects continue to evolve. Ongoing monitoring and evaluation are in place to ensure project continuity.

All Grantees

Government of Kenya

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