Includes how major projects are financed and gives examples where relevant. Explains activities of the multilateral development banks in and other aid-funded projects where procurement is open to U.S. bidders.

Kenya relies heavily on financing assistance from donors and has historically focused more on capacity building than commercial projects. This has somewhat shifted with the announcement of President Kenyatta’s “Big Four” development agenda that focuses on four main pillars for the development and advancement of the people of Kenya. These pillars are; Food Security, Manufacturing, affordable Housing and Universal Healthcare.

In June 2018, the Government of Kenya signed a Memorandum of Understanding(MoU) with the United States Government. Under this MOU the Governments agreed that private companies that implement strategic infrastructure and Big Four priority projects are responsible for securing appropriate financing for such projects. The governments also intend to develop and regularly update both a plan, to be referred to as the "U.S.-Kenya Roadmap for Business Climate Improvements", and a list of projects, to be referred to as the "U.S.-Kenya Priority Project List", to be shared to U.S. companies.

There are three sources of external assistance: multilateral, bilateral, and Private Voluntary Organizations (PVOs). The first category can further be divided into United Nations Organizations and non-United Nations multilateral institutions. Bilateral donors lead in provision of project financing, followed by multilaterals and PVOs.

Multilateral Development Banks
The largest overall multilateral donor is the World Bank. During the period FY14-FY18, the World Bank Group plans to invest over $1 billion a year in Kenya, mainly through the International Development Association (IDA), the International Finance Corporation (IFC) and the Multilateral Investment Guarantee Agency (MIGA). The current IDA portfolio amounts to $ 5.5 billion in 27 national projects ($4.2 billion) and six regional projects ($1.3 billion),this includes new commitment of $200million in Kenya Devolution Support Program for results that was approved in March 2016. The projects are mainly focused in infrastructure (transport, energy, water and telecommunications), urban, health, public sector management and social protection.

The private lending arm of the World Bank, IFC supports Kenya’s private enterprises through direct investments, advisory services and mobilizing capital from global financiers. To date, IFC has invested $1 billion in agribusiness, infrastructure, financial markets, health and education in Kenya. IFC’s private sector clients and partners are tackling pressing development challenges, such as access to power, healthcare and food. It has invested in a wide range of companies, including Kenya Airways, Bridge International Academies, National Cement, AAR Healthcare, Faulu Kenya and Vegpro.

MIGA is providing investment guarantees of $302 million in support of projects in Kenya’s infrastructure, power, agribusiness and service sectors. It is working closely with the Bank and IFC to help leverage financing for the construction of privately operated power plants to diversify Kenya’s energy mix in line with the government’s least cost power development plan. These projects insured by MIGA include an 84-megawatt private geothermal plant and an 87 megawatt heavy fuel oil plant supported by partial risk guarantees of $166 million. MIGA is also receiving increasing interest from other investors and sectors in the country. For the list of active World Bank-funded projects please visit the World Bank.

Another multi-lateral donor that is active in Kenya is the African Development Bank (AfDB). The AfDB is a financial provider to African governments and private companies investing in the regional member countries (RMC). The primary function of AfDB is making loans and equity investments for socio-economic advancement of the RMC. The Bank also provides technical assistance for development projects and programs, promotes investment of public and private capital for development and assists in organizing the development policies of RMCs. Since 1967, total AfDB lending to Kenya in terms of loans and grant approvals amounts to $3.22 billion. For more information on opportunities for projects funded by AfDB, U.S. firms should visit online.

The Overseas Private Investment Corporation (OPIC) is the U.S. Government’s development finance institution. It mobilizes private capital to help solve critical development challenges and in doing so, advances U.S. foreign policy. Because OPIC works with the U.S. private sector, it helps U.S. businesses gain footholds in emerging markets, catalyzing revenues, jobs and growth opportunities both at home and abroad. OPIC achieves its mission by providing investors with financing, guarantees, political risk insurance, and support for private equity investment funds. To date, OPIC has supported more than $200 billion of investment in over 4,000 projects, generated an estimated $76 billion in U.S. exports and supported more than 278,000 American jobs.

The Export-Import Bank of the United States (Ex-Im Bank) is the official export credit agency of the United States. Ex-Im Bank's mission is to assist in financing the export of U.S. goods and services to international markets including Kenya. Ex-Im Bank provides working capital guarantees (pre-export financing); export credit insurance; and loan guarantees and direct loans (buyer financing). Ex-Im Bank has done structured transactions such as multiple-country fiber-optic cable, oil and gas projects, air traffic control, telecommunications and manufacturing entities. With 80 years of experience, Ex-Im Bank has supported more than $567 billion of U.S. exports, primarily to developing markets worldwide. Ex-Im Bank’s largest exposure in Kenya is mainly with Kenya Airways, through its support for the latter’s procurement of Boeing aircrafts.

The U.S. Trade and Development Agency is a critical enabler of project financing and helps companies create U.S. jobs through the export of U.S. goods and services for priority development projects in emerging economies.  USTDA links U.S. businesses to export opportunities by funding project preparation and partnership building activities that develop sustainable infrastructure and foster economic growth in partner countries.

USTDA’s sector teams have cultivated in-house technical expertise in key industries, helping the Agency analyze global demand and identify sectors that represent the greatest opportunity for growth in U.S. exports.  As a result, USTDA targets its programming in the energy, transportation and telecommunications sectors, where U.S. firms are most competitive and where the Agency’s assistance can help its partner countries develop the infrastructure needed for trade.

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