Kenya is trying something interesting with its new National Infrastructure Fund (NIF). With an initial base of about Sh340 billion, it is expected to mobilise much more private and non-traditional capital for nationally significant infrastructure.
Its proposed investment policy places considerable emphasis on commercial discipline. Projects are expected to attract significant private financing and generate sufficient returns. These are important safeguards. But they also raise a much bigger question that matters beyond Kenya: What happens when we become very good at financing the wrong infrastructure?
A project can be bankable, have a credible business model, meet technical requirements and attract investors, and still be the wrong answer to the problem people actually have. We often tend to ask: Can we finance it? Yet, I think we need to ask, much earlier: Should we finance it? What problem are we solving, and what evidence tells us it is the right one?
Consider Nairobi’s transport problem. Over the years, Kenya has invested heavily in expanding and improving the city’s road network. Some of these investments have delivered significant benefits. The Nairobi-Thika Highway, for example, dramatically improved connectivity. But a successful road project does not automatically mean we have solved the mobility problem.
The World Bank estimates that more than 80 per cent of trips in Nairobi involve walking as a primary or secondary mode. Yet people travelling by walking and matatu can access less than 8 per cent of jobs within 60 minutes. Congestion in the Nairobi Metropolitan Area has also been estimated to cost the economy about $1 billion a year.
Nairobi demonstrates the difference between solving an infrastructure component and solving the infrastructure problem. A road can increase capacity, but mobility is also about how people get to the road, how public transport connects different parts of the city, how pedestrians interact with the network, where jobs and homes are located, and how these pieces work together.
There is something we often miss when discussing infrastructure across Africa: the people who live with the consequences of an infrastructure investment.
An investor sees a return. A government sees a development target. But the commuter sees the journey. The trader sees whether goods move. The parent sees whether the school is accessible. The household sees whether water actually arrives. The community sees whether the project changed anything.
When we choose the wrong intervention, the cost is not simply the money spent constructing it. We can lock capital into an asset that does not deliver its expected value, create long-term maintenance obligations, miss better alternatives and continue paying for the original problem.
This matters when we consider the scale of Africa’s infrastructure needs. East Africa is estimated to need about $42 billion a year in infrastructure investment until 2040 to close its infrastructure gap with peer regions, equivalent to about 8.6 per cent of the region’s GDP in 2024. That is an enormous amount of capital. The question, therefore, cannot only be how we mobilise it but also where we put it.
This is where the NIF presents an opportunity; if the Fund is going to attract private capital and generate returns, it should also help strengthen the quality of the decisions that determine where that capital goes. Commercial viability matters, but it should not become a substitute for strategic relevance.
We need to understand the problem before designing the project, test our assumptions before committing the money, consider alternatives before locking ourselves into one solution, and look at the full life of the asset rather than stopping at construction.
The road, hospital, water system, railway or energy project that people experience is only the visible end of a much longer chain of decisions. If we become better at examining that chain – the problem, the evidence, the alternatives, the risks and the people affected – we might finally get better at deciding what infrastructure is worth financing in the first place.
Olyvia Lavisa, Civil & infrastructure engineer
