President Uhuru Kenyatta’s Cabinet has approved the Laikipia County government’s request to borrow Sh1.16 billion through a domestic infrastructure bond at the stock market.
The decision makes the county the first since the advent of devolution to float a bond to raise money in the Nairobi Securities Exchange.
A Cabinet meeting on Thursday that was chaired by President Uhuru Kenyatta and attended by his Deputy William Ruto heard that the approval was made under the Public Finance Management Act (No. 18 of 2012).
“The objective of the infrastructure bond is to finance implementation of projects including provision of water for agricultural production, and improvement of the business environment by upgrading markets and town infrastructure; which will provide additional jobs to the residents of Laikipia and improve their household incomes and livelihoods,” the Cabinet secretaries were told.
The approval followed that of the Intergovernmental Budget and Economic Council (IBEC), the National Assembly and the Laikipia County Assembly.
The proceeds from the seven-year bond will be invested in water and sewerage systems, paving roads, walkways and cyclist paths and enhancing street lighting and enforced building zones, said Laikipia Governor Ndiritu Muriithi.
“The targeted projects will help spur economic activity, helping it enhance revenue collections through single business permits, parking fees, land rates as well as water and sewerage connection charges,” he said.
The choice of projects, he said, was guided by need and the ability to generate specific cash flows that will be used to repay the bond.
“The projects will in return generate cash flows from various user fees, levies and taxes. As we pave more towns and provide parking, we collect more fees,” he said.
The urban centres earmarked for development include Nyahururu, Nanyuki, Kinamba, Ol Jabet, Wiyumiririe, Doldol, Karuga, Naibor, Kalalu, Mouwarak and Pesi.
The upgrading and beautification of the Karuga shopping centre to the tune of Sh96 million is ongoing and is expected to be completed in eight months’ time, said Finance executive Murungi Ndai.
The shopping centre, which also hosts Laikipia University’s main campus, will benefit from a 1.2km of road that will be updated to bitumen standard, the construction of 4.4km of footpaths, and the installation of street lights and drainage systems.
Last week, the county administration contracted the National Youth Service (NYS) to implement another Sh160 million beautification project in Doldol, Laikipia North.
Governor Muriithi has said giving the project to the NYS was prompted by an existing memorandum of understanding (MOU) between his administration and the agency.
“We have an existing MOU of working together on development projects with NYS, hence the move by the county administration to hand over the project to the government institution," he said.
The beautification work in Doldol, the headquarters for Laikipia North constituency, will be completed within eight months. It involves upgrading a 1.38km road to bitumen standard, building 1.84km of footpaths, and installing street lights and drainage systems.
Developing the 11 towns, Mr Muriithi said, is projected to inject 74,166 additional jobs into the county’s economy through the creation of 31,698 new businesses.
Once the work is completed, Nanyuki will see the setting up of 6,408 new businesses and the creation of 19,223 jobs. Nyahururu will see 4,363 new businesses with 13,089 employment opportunities and Kinamba 5,399 new businesses with 10,798 jobs, Governor Muriithi said.
Wiyumiririe, he added, is expected to attract 8,257 new businesses that will create 16,514 employment opportunities, and more businesses in Doldol (3,489), Karuga (886), Naibor (639), Kalalu (864), Mouwarak (811) and Pesi (752).
