Kenya to Terminate Ksh.190B Nairobi-Nakuru Highway Expansion Deal with French for China
NAIROBI – April 2025 — Kenya is set to cancel a €1.3 billion (approximately Ksh.190.8 billion) highway expansion agreement with a French-led consortium, government officials and sources familiar with the matter have confirmed. The project is now expected to be awarded to a Chinese contractor, whose identity has not yet been disclosed.
The original deal, signed in Paris in 2020 during a state visit by then-President Uhuru Kenyatta, aimed to transform 140 kilometers (87 miles) of single-lane road into a multilane highway connecting Nairobi to Nakuru, a key city in the Rift Valley. The agreement was part of a public-private partnership (PPP) with a consortium led by Vinci Highways, a subsidiary of France’s Vinci SA (SGEF.PA). French private equity firm Meridiam SAS and Vinci Concessions were also involved in the venture.
According to the Kenya National Highways Authority (KeNHA), the government had sought to renegotiate aspects of the contract, citing concerns that the original terms unfairly placed the risk of low traffic volumes on the government.
"KeNHA requested a restructuring of the contract... but the proposal was considered unbankable thus creating a stalemate," the agency told Reuters. With no progress made, KeNHA subsequently issued a formal notice of termination for the PPP contract.
As of now, construction on the highway had not commenced.
Vinci SA declined to comment on the development, and Meridiam has not responded to requests for comment.
Two sources with direct knowledge of the situation, who spoke on condition of anonymity due to media restrictions, indicated that the contract is expected to be awarded to a Chinese firm. The sources did not specify which company would take over the project.
The shift in partners comes as Kenya strengthens its diplomatic and financial ties with China. Finance Minister John Mbadi recently led a delegation to Beijing for high-level talks with senior Chinese officials. Additionally, President William Ruto is scheduled to make a state visit to China later this month, according to domestic media reports.
The highway expansion is considered a key infrastructure project aimed at easing traffic congestion and boosting trade between Nairobi and Kenya’s western regions.
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