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. The GCL carried the following borrowing terms: a 19.5 year maturity (final maturity date: September 21, 2038), a 7-year grace period (first repayment date: March 31, 2026), a 2% interest rate, and a 0.5% commitment fee. 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.

Additional details

1. The Chinese project title is 孔扎数据中心和智慧城市项目. 2. The e-ProMIS ID number for the Konza Data Centre and and Smart City Project is 058131. 3. 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. 4. The loan identification number in the National Treasury’s public debt register is 2019006 (2019006_1). 5. 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=0

Number of official sources

12

Number of total sources

22