Category: Business Daily

The wealth of investors in the Nairobi Securities Exchange (NSE) has increased by Sh1.04 trillion since the start of the year, in the wake of share price boom, cementing the bourse as the top asset class.

The Nairobi bourse has posted a 53.7 percent return so far and on course to close the year at the best performance in over a decade, following up gains of 34.7 percent in 2024.

Returns from stocks in the year so far are nearly five times higher than the second major asset class, asserting the dominance of local equities in the 2025 investment playbook.

The highest grossing money market fund has an annualised return of 11.71 percent, making it the distant second top asset class ahead of returns from the 364-day/one year Treasury bill, which came in at 9.3454 percent as of last week.

The average return from property sales meanwhile sits third, returning gains of 8.2 percent on an annualised basis as per data from Hass Consult third quarter property index.

Gains from land sales within Nairobi suburbs such as Muthaiga, Pangani, Kilimani and Kilileshwa meanwhile average to 6.27 percent.

Commercial bank fixed deposits currently fetch a lower return of 7.63 percent, while property rentals have left most investors in losses, averaging an annualised contraction of 1.3 percent.

Market capitalisation over the period has risen from a low Sh1.439 trillion at the end of 2023 to Sh2.981 trillion as at the close of trading on Tuesday this week.

More than three quarters of the NSE paper wealth increase sits in blue chip stocks such as Safaricom, Equity, KCB, EABL and NCBA.

The five stocks have recorded an increase of Sh475.9 billion, Sh71.5 billion, Sh84.1 billion, Sh51.4 billion and Sh140.8 billion respectively since the turn of the year.

Small cap stocks however remain in the green with Olympia Capital leading the way with gains of Sh173.6 million ahead of Express Kenya, Flame Tree Group, Uchumi Supermarkets and Eveready.

Sameer Africa Plc has led the way in overall gains as its stock price shoots by 488.4 percent, ranking ahead of the NSE, Home Africa, utility Kenya Power and TransCentury.

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There was a time when a bottle of Krest or the Stoney dominated the beverage coolers and drinks shelves in supermarkets. They were the go-to ‘chaser’ on a night out. Their flavours, citrus and ginger, were part of the social offerings at weddings, family picnics and on bar counters.

Today, the shelves look a little different as new bottles of imported tonics, zero-sugar sodas, fruit-infused sparkling waters and craft beverages targeting a more adventurous and health-conscious drinker overshadow Krest and Stoney.

Yet despite the changes and market competition, Coca-Cola insists the two drinks are here to stay.

‘Krest and Stoney are among the brands that Kenyans continue to know and love and remain fully available in the market. These are brands with deep roots and local love, and we are committed to keeping them available,’ the company says.

Stoney carries a gingery punch, which is a fiery favourite with a staunch following among those who love a drink with character. It has a bold aura, the kind that stands toe-to-toe with vodka, whisky and rum.

Krest has a smooth, citrusy taste that is light, tangy, and refreshing. For the longest time, Krest was synonymous with ‘the chaser.’

The rise of new players

Kenya’s drinking culture has evolved; walk into an urban bar today and you’ll notice a new breed of soft beverages lining the fridge. There are premium tonics like Fitch and Leedes, East Imperial and Fever-Tree to locally produced fruit sodas and energy drinks that cater to younger and image-conscious consumers.

In supermarkets, shelves have the zero-sugar options, sparkling waters, and imported mixers, which target the growing middle class. The gin wave, which hit the market a few years ago, also brought in new tonic water varieties, with each claiming to pair perfectly with different botanical spirits.

Bartenders now experiment with infused sodas, flavoured mixers, and homemade ginger tonics. It has become a more sophisticated scene amid all the variety, and people often find themselves returning to try something new.

Coca-Cola says they understand the shift and it is matching up to balance the global innovation with that of local loyalty.

‘There are no plans to replace these locally loved brands. We are proud to continue offering classic favourites like Coca-Cola, Fanta, Sprite, Schweppes, Krest and Stoney.’

At Cool Sip drinks depot in Nairobi’s CBD, a small but busy shop that supplies both walk-in customers and nearby pubs, Stephen Mute, the manager, attests that five years ago, Krest, Stoney and Sprite were among the fastest-moving drinks, especially during the weekend.

‘There was a time these drinks would barely last two days in stock, especially around weekends; they were the deliberate chasers, and everyone wanted them.’

How have their sales changed?

‘They still make sales, but it is a bit slower. I used to sell even 15 crates of each over the weekend, but now I can barely move five. Even some of my older customers who swore by Krest now mix things up. They will ask for tonic, or some sparkling water. It’s not that they’ve stopped liking it, it’s just that people want to try something new every so often.’ Mr Mute says.

He adds that the trend is most visible among younger customers, who often walk in asking for a drink they saw trending on social media.

‘But, I can’t stop stocking Krest or Stoney. They move slower, but they move. Someone always comes asking because even these small shops still need the variety in their options. The drink is still other people’s favourite,’ he says.

What people are chasing with now

When it comes to the drinking settings some swear by Fitch and Leedes Pink Tonic, others lean toward Schweppes Dry Ginger Ale or energy drinks like Monster and Predator for a stronger kick.

Mixologists say the evolution is not about replacing the old favourites but expanding the drink palate.

Tony Njoroge, a Nairobi-based mixologist says that consumers today are exploring combinations that go beyond the traditional.

‘Kenyan drinkers have evolved because back then hard vodka meant Krest. Whiskey meant Stoney and that was the standard combination. But now people want variety. They want to try pink tonics, elderflower infusions, even the ginger-lime sparkling water,’ he says.

Tony, who has worked with both international spirit brands and local distributors, says the change is not leaning toward abandoning the classics, it’s expanding the consumer’s taste.

‘I have deep respect for Krest and Stoney, they’re part of our bar heritage. But when you look at how drink culture is changing globally, you see why Kenyans are curious about new options. These new drinks bring out different notes in gin and vodka. They’re lighter, more aromatic and that appeals to modern consumers.’

Still, he insists that the two Coca-Cola icons remain irreplaceable. ‘The drinks still remain given their authentic taste. We also use that same Stoney in a modern cocktail like when making a ginger mojito or spiced spritz,’ he says.

‘We are not replacing Krest or Stoney, we’re complementing them. Kenyan drinkers are ready for both the tradition and the trend,’ he adds.

Kenyans in recent days have reacted with predictable pessimism and suspicion to President William Ruto’s remarks regarding our state of electricity generation.

As a result of years of moratorium on new power purchase agreements pushed by seemingly continuous power sector investigations over the last seven years, and resultant indecision, we find ourselves with peak demand exceeding effective capacity.

Peak demand recently hit 2,411 megawatts while effective peak capacity lags at 2,370 megawatts. Effective capacity at peak considers what would be available to meet our evening peak of 3,200 megawatts installed on the grid.

This includes all our thermal capacity, and still, we will fall short of demand at peak. This directly implies that we are switching off some consumers at peak hours due to insufficient generation.

We additionally find ourselves importing 280 megawatts from Ethiopia and Uganda to supplement local generation. This implies that more than 10 percent of the power we use is imported, without an effective local backup, exposing the country to external shocks.

These two neighbouring economies have growing populations and own ambitions for expanding industrial activity. Our desires for supply will, in time, be overridden by their own needs to grow. Enabling this trade under the Eastern African Power Pool is desirable, but at the same time, Kenya needs to have a failsafe.

Extreme weather, political or technical events, could imply that Kenya is not able to access the imported power. We would have to ration whatever power would be available at that time, limiting economic and social activities.

Simply put, we need more generation on the Kenyan national power grid. Preferably locally installed.

Coming back to the public scepticism when numbers like 10 gigawatts (GW) and 1.2 trillion are pronounced, I understand, relate to and respect the reaction.

We have been treated to a circus of projected increases in generation in the past, from the 5GW in two years of the NARC era to the 40GW by 2040 of the Jubilee era. All pipe dreams without tangible demand plans or a visible outcome in 2025.

It is a case of once bitten twice shy, thrice sceptical. You see, demand availability is the straw that breaks the camel’s back.

Increased generation capacity must follow projected demand, and technical teams should take the lead in projecting desired installed capacity. Kenya has a very capable least-cost power planning team that, when presented with firm demand, can project desired generation capacity.

Demand and generation projections should be above board and based on committed projects in generation and industrialisation. The sector had planned for years, considering committed projects under Vision 2030, most of which have not seen the light of day, five years to 2030.

Gross over-generation with the technologies available to us will result in increased costs, while under-generation will stifle economic growth and our capacity to attract investments.

Demand is organically growing at between 100 megawatts and 140 megawatts each year, but that does not mean that we cannot end up with a single industry requiring greater than 500 megawatts.

We can also not afford to have 2GW lying in wait without a plan for the demand. Consumers would bear the huge costs for copious amounts of idle power. This is why demand and generation normally grow hand in hand within a certain margin, with generation leading the way.

Not only should the technicalities of balancing demand and generation be considered, but the process of onboarding new generation needs to be above board.

Every Kenyan understands the desperate need for infrastructure to develop our economy, but not at the altar of opaque processes and lined-up favourites.

These often end up being a raw deal to the economy and are often a prelude to industry-scale pogroms by new regimes looking to smoke out past beneficiaries. We then end up in moratoria that delay much-needed infrastructure. The Adani fiasco must have surely taught us something.

This is part of the angle sceptics of recent pronouncements are operating from, once bitten, twice shy.

We must allow those tasked with projecting demand and supply to do their job and take the lead. We need more generation on the grid.

The power must, however, be procured in above-board approaches open to competition.

The Agriculture and Food Authority (AFA) has announced a two-and-a-half-month ban on the harvesting and trading of locally produced macadamia nuts, citing immature crop development and the need to safeguard Kenya’s premium quality reputation.

The ban, which takes effect on December 1, 2025, and runs until February 15, 2026, will apply to all value-chain actors, including processors, exporters, importers and marketing agents.

In a statement on Tuesday, AFA Director-General Bruno Linyiru said the temporary freeze follows findings from a recent survey indicating that a large portion of the crop is still growing and has not reached full maturity.

‘The Authority has established that a substantial portion of the crop is still undergoing physiological development… The closure period will allow adequate time for the nuts to mature fully and meet export quality standards,’ said Dr Linyiru.

The directive, implemented through the Nuts and Oils Directorate, seeks to align harvesting and processing with natural maturity patterns to maintain high kernel quality, oil content, and shelf life – attributes that have helped position Kenyan macadamia among the world’s most sought-after varieties.

AFA said the measure is also aimed at protecting farmers from post-harvest losses and low farm-gate prices, which typically follow premature harvesting when nuts have low oil content and poor drying characteristics.

Kenya, one of the world’s top macadamia exporters, has in recent years faced fluctuating quality and volatile prices blamed on early picking and unregulated trading by middlemen.

The Authority said it will intensify field inspections across the main growing zones, in Central, Eastern, and Rift Valley regions, to enforce compliance, warning that traders found violating the closure will face legal penalties.

Processors have in the past supported the seasonal closure, arguing that Kenya’s competitiveness in premium nut markets depends on meeting strict moisture and kernel standards demanded by international buyers.

Section 43 of the Agriculture and Food Authority Act, 2013, prohibits the export of raw macadamia except with written approval from the Agriculture Cabinet Secretary.

Last year, processors faced heightened competition from Chinese buyers after the government temporarily lifted the export ban on raw nuts, known as nut-in-shell (NIS), to address a glut that had driven farm-gate prices down from a high of Sh180 per kilogramme to Sh30.

Local processors were unable to absorb the surplus due to weak demand for processed kernels in key export markets such as the United States.

By easing the restriction, the government sought to open new markets and reduce stockpiles held by farmers.

According to the Kenya National Bureau of Statistics (KNBS) Economic Survey 2025, Kenya had 11,090 hectares under macadamia production in 2024, producing 51,200 tonnes worth Sh4.95 billion.

Kenya’s financial regulators have raised concern over the heavy reliance on a small number of third-party technology service providers by many institutions in the sector, warning that it poses a major financial stability risk.

Banks, insurers, pension schemes, cooperatives, and capital market firms increasingly depend on external providers for services such as mobile applications, artificial intelligence (AI) automation, and fraud detection and prevention.

However, the Joint Financial Sector Regulators Forum cautions that with too many firms relying on the same few providers, the industry is overly exposed, threatening consumer protection and operational resilience.

‘The Forum identified reliance on third-party technology service providers as a major source of risk, especially if a single service provider serves many institutions,’ the group of regulators said in a joint communiqué following a meeting last week.

The forum brings together the Central Bank of Kenya (CBK), Capital Markets Authority, Insurance Regulatory Authority, Retirement Benefits Authority , Sacco Societies Regulatory Authority, Policyholders Compensation Fun, and Kenya Deposit Insurance Corporation.

‘In the event of failure, the operations of many institutions are likely to be compromised, impacting their ability to deliver optimal services,’ the regulators added, noting that they are now prioritising efforts to map concentration risks among third-party providers in the financial sector.

This warning comes amid increased adoption of emerging technologies such as AI and mobile banking, as financial institutions seek to improve customer experience and curb risks like fraud and cybercrime. Since many of the companies in the industry lack the technical or financial capacity to develop such systems in-house, they often outsource these functions to external providers.

A recent CBK survey revealed that all commercial and microfinance banks in Kenya engage third-party technology service providers, with a majority (42 percent) working with at least 10 different providers at once – an indicator of the sector’s deep dependence on outsourced tech services.

The survey also found that 26 percent of banks have more than half of their services supported by external tech firms, while another 26 percent have between 21 and 50 percent of their operations anchored on third-party providers.

Payment aggregation is the most outsourced function, cited by 82 percent of commercial banks, followed by cybersecurity tools (76 percent), anti-money laundering compliance (58 percent), funds transfers (55 percent), credit scoring (37 percent), and lending (24 percent).

While other regulators have not published similar surveys, reports from individual companies suggest they are equally reliant on outsourced technology.

For example, insurers such as APA and Jubilee have already deployed AI systems to mitigate risk and enhance underwriting processes.

Reports that hundreds of youths were turned away during the recent Kenya Defence Forces (KDF) recruitment after testing positive for drugs and other substances are disconcerting.

Authorities said other than testing positive for alcohol, the culprits also had traces of bhang, heroin and cocaine in their bloodstream.

While KDF’s move has understandably denied the affected youth the opportunity to become better people, it also offers us an opportunity to ask ourselves what really drives young people to find solace in drug and substance abuse.

Excessive drug use is a result of many underlying issues, including joblessness, trauma, depression, broken homes, mental health problems, and hopelessness. When they can’t find solutions to such problems, many young people turn to alcohol and other drugs for solace.

According to the National Authority for the Campaign Against Alcohol and Drug Abuse (Nacada), young people between 18 and 24 have the highest prevalence of alcohol and drug use nationwide.

This is the very age bracket we depend on to power the economy, form our workforce, and defend our borders. To safeguard our future, we need to sit back and rethink our approaches to tackling alcohol and drug use among youth.

Recently, Nacada proposed to raise the legal drinking age to 21, citing early initiation to alcohol as a long-term predictor of addiction and other cognitive impairments. It also proposed restrictions in advertising and zoning laws, limiting the proximity of alcohol outlets to schools and churches.

As the debate on whether or not to embed the proposals into our laws continues, one can’t help but have the ‘we’ve been here before’ feeling.

Many may remember the sensational (and visionary) ‘Mututho laws’ of 2010. They attempted to regulate drinking hours and the advertising of alcohol. The enforcement was thorough, and for once in a long time, something seemed to be working. However, the current surge in drinking levels is proof of their short-term success.

While well-meaning, the proposed reforms by Nacada risk repeating the same mistake. Without understanding the motivations or causal factors leading to excessive alcohol and drug use, we are running in circles.

Any successful intervention must begin with dissecting the root causes of addiction or excessive drug use. One way to do this is to align our mitigation measures with the science of addiction.

Let’s recalibrate our strategy from reactive and restrictive to preventative. Nacada has done a commendable job over the years in curbing drug abuse. However, it’s time its role evolved from a regulator to a facilitator of recovery and healing.

Addiction or excessive substance use does not happen overnight. It has stages which begin with experimentation (often due to curiosity or peer pressure). Then regular or social use. From here, it deepens to risky use and dependence as tolerance increases, and finally to addiction.

The question we should therefore ask is: Will the restrictions on online sales and geographical proximity to alcohol establishments help young people who are in the dependence and addiction stages? Will the new age-limit discourage experimentation? If not, what approach can work best to help our children?

If we ignore this and instead focus on enforcing restrictions, we risk rebellion rather than compliance like happened with cannabis reforms, where overzealous crackdowns led to black market glorification. We may end up winning the battle, but losing the war.

We also need to seal the parenting gaps that lead to alcoholism and drug use. This means having open conversations with our children on substance use and good modelling. Parents can also be taught to recognise the early signs of substance use.

The law should mandate alcohol manufacturers and other beneficiaries to contribute to the treatment of addiction (in addition to efforts by the State through the Social Health Authority initiatives) and fund counselling therapy centres, either through Corporate Social Responsibility activities or licensing levies.

We can also double on proven strategies of old, like sports drives and other co-curricular activities.

President William Ruto’s administration plans to standardise pricing of public infrastructure projects in a sweeping reform to tame inflated contract costs and cut wastage of taxpayer money.

The Cabinet on Tuesday approved what it called a ‘Comprehensive Framework for Infrastructure Projects Pricing’ in a bid to eliminate irregular, inconsistent and expensive processes in the implementation of public projects such as roads, bridges, dams, power plants and electricity transmission lines.

The framework will introduce a data-driven system for determining costs of infrastructure, replacing the current precedent-based approach which the government has used for decades in budgeting for public projects.

The current framework has, however, been heavily criticised for fuelling cost overruns, which have made the cost of building projects in Kenya among the most expensive in Africa.

The new practice borrows heavily from the United Kingdom, Australia and Singapore, which apply the First Principles Approach to derive project costs from fundamental input data such as materials, labour, equipment and location-specific conditions.

The Cabinet estimates the new system could cut cost overruns by up to 25 percent, helping to restore discipline in planning and execution of public projects.

‘The framework seeks to eliminate the irregular, inconsistent, and costly practices that have characterised the pricing of government infrastructure projects,’ read a dispatch from the Cabinet after a meeting on Tuesday.

‘It aims to establish a data-driven system for determining infrastructure costs, ensuring accountability and prudent use of public resources.’

The Cabinet said that despite the government spending heavily on infrastructure over the past two decades, Kenya continues to suffer from cost variability, budget overruns and project delays.

These challenges are linked to reliance on outdated pricing formulas and limited market intelligence.

The looming policy shift comes barely two months after the Kenya National Highways Authority (KeNHA) announced plans to overhaul the formula the agency uses to adjust project prices for inflation, citing ballooning costs that have derailed or stalled major road projects.

The KeNHA said in September it would review the Variation of Price (VOP) formula applied to contracts after uncovering ‘unprecedented escalation of variation of prices’ that had made projects expensive and caused budgetary distress.

VOP, a standard provision in long-term contracts, adjusts a project’s cost to account for fluctuations in input prices such as labour, fuel and construction materials.

But KeNHA’s recent audit found that poor formula design, unbalanced cost weightings, and misapplied indices have led to billions of shillings in unplanned costs.

‘The authority has experienced unprecedented escalation of variation of prices in ongoing development contracts, making projects expensive and giving rise to budgetary challenges,’ KeNHA said.

A Business Daily analysis of the Treasury and Transport ministry data earlier revealed that 26 major infrastructure projects – primarily under KeNHA and the Kenya Urban Roads Authority -overshot their original combined budgets of Sh682.7 billion to Sh703.4 billion, a jump of Sh21 billion.

Among the affected projects are the Kenol-Sagana-Marua highway, Mombasa-Mariakani road, and Horn of Africa corridor, which have all experienced cost jumps linked to compensation delays, poor design documentation, and underestimated feasibility studies.

For instance, the cost of the Sagana-Marua dual carriageway ballooned by nearly 50 percent in just three years, from Sh6.1 billion to Sh9.1 billion, according to a March 2025 audit by Auditor-General Nancy Gathungu. The surge was attributed to omissions in the feasibility study and land acquisition delays.

Similarly, the cost of the Kenol-Sagana section rose by Sh3 billion after budget cuts by the Treasury slowed payments to landowners.

The KeNHA has since initiated a pricing audit covering seven flagship projects, including the Eldoret Bypass, Mombasa-Mtwapa-Kilifi road, and Isiolo-Mandera corridor, with a view to determining reasonable variation thresholds and preventing future overruns.

The authority will also benchmark against projects funded by development partners such as the World Bank, European Union, Exim Bank, KfW, and JICA, which typically maintain stricter cost-control mechanisms.

Grain handling company Bulkstream has opposed an application by a Ugandan importer who has sued it seeking release of its 1,514 tonnes of Ukrainian wheat unconditionally.

Bulkstream says that it entered into a bailment agreement with Pan Afric Commodities to which, as a bailee, it retains a legal lien of the wheat over accrued and unpaid handling and storage charges, which at September 30 stood at $1.1 million.

Legal lien is right to hold someone else’s property until the debt owed is paid.

Bulkstream, the only bulk grain handling facility in the country, is associated with Mombasa-based businessman Mohamed Jaffer.

In an affidavit filed in court, Bulkstream says that once a case with regard to the cargo was terminated at the Court of Appeal, it was its expectation the importer would approach them to settle the accrued storage charges.

‘The bailment agreement that stipulates payment of handling, storage and related charges has never been revoked,’ the affidavit reads.

As such, Bulkstream says it still retains the right of lien over the goods until full payment.

Pan Afric Commodities says that Bulkstream’s assertion that the dispute is founded on the accrued amount and contract of bailment is contrary to their (Bulkstream) representation to them that they cannot release the cargo due to receivership proceedings in Uganda.

Through an affidavit of Abdelateef Mohamed, Pan Afric Commodities says Bulkstream is attempting to bring irrelevant and inconsequential facts to illegally detain its cargo.

Pan Afric Commodities says it purchased approximately 2,837 tonnes of wheat which was shipped to the port of Mombasa under a charter party agreement and was subject of Bill of Lading which was issued on September 21 2018.

The court directed the case to be mentioned on February 4, 2026.

The company and its two directors Mohammed Hamid and Abdelateef Mohamed say that the wheat which was shipped in bulk form was handled by Bulkstream (formerly Grain Bulk Handlers Ltd) pursuant to instructions issued to it.

In their application at the High Court in Mombasa, the applicants say that out of the total amount purchased, some of the cargo remained in storage until Pan Afric Commodities paid the requisite import taxes and customs duties to the Uganda Revenue Authority (URA).

‘Upon clearance of customs duties with URA, Bulkstream generated discharge invoices and advised the applicants on the outstanding storage charge that would need to be cleared prior to the release of the cargo which at May 2020 stood at US Dollars 286,379.38 (Sh36.9 million),’ the application states in part.

According to the applicants, they developed a comprehensive payment plan to settle the outstanding charges.

They also claim that as they were making arrangements to make the payment, Bulkstream informed them that they could not release the goods as they had received instructions from a Receiver Manager declaring that Pan Afric Commodities was under receivership.

The applicants say that they were also informed that the cargo was purportedly under the control of the Receiver Manager and should only be released to him.

‘The Receiver Manager has not complied with express provisions of the law touching on cross-border insolvency proceedings as stipulated in the Insolvency Act and therefore the cargo is not subject to his jurisdiction,’ part of the case documents state.

The applicants argue that Mr Hamid and Mohamed being directors of the company have exchanged several correspondences with the respondent (Bulkstream) advising them that they are illegally holding the cargo since it is not under the jurisdiction of the Receiver Manager thus it should be released to Pan Afric Commodities under the provisions of the Bill of Lading.

‘In addition the Receiver Manager has attempted to have the cargo released to him using falsified customs documents which have been detected by the respondent yet they have still declined to release the cargo to the first applicant who is the legal owner and lawfully entitled to it under the Bill of Lading,’ case documents state in part.

The applicants claim that they continue to incur heavy and substantial losses in form of accumulating storage charges, declining quality of the wheat and loss of profit since it cannot sell the wheat due to the illegal detention of the cargo by Bulkstream.

Pan Afric Commodities is also seeking for an order that it is not liable to pay storage fees for the period after January 28 2021 when Bulkstream communicated to them that the goods cannot be released because they are under the jurisdiction of a Receiver Manager.

The State has revived a project to dual Kiambu Road less than four months after pulling the plug on a tender to upgrade the section through Chinese contractors.

The Cabinet has announced the revival of the project but has not indicated whether the tender would remain restricted to Chinese contractors.

The choice of Chinese contractors’ rests on the project’s financial backing by the Chinese government through the China Exim Bank.

The project sits in the government’s broader action plan to modernise the Nairobi metropolitan transport network.

‘The Cabinet also gave the greenlight to the dualling of the 23.5km Muthaiga-Kiambu-Ndumberi road to ease congestion and improve mobility between Nairobi and Kiambu counties,’ read a Cabinet dispatch on Tuesday.

‘The project will expand the existing two-lane highway into a dual carriageway, complete with bypasses, loops and access roads to increase capacity and reduce travel times.’ The Kenya National Highways Authority (KenHA) abruptly cancelled the international tender for the upgrading of the road known as B32 in late July, before the tender’s scheduled closing date of August 22, 2025.

The road agency failed to issue an explanation to the cancellation of the procurement process even after queries sent to it by the Business Daily.

The cancellation came at a time when the agency was grappling with leadership changes following the sudden exit of the then Director-General Kungu Ndung’u before the end of his term.

The project involves the expansion of the heavily used corridor linking Pangani in Nairobi to Ndumberi in Kiambu County via Muthaiga and Kiambu town.

Plans for the upgrade included a dual carriageway, road widening, improved drainage and pedestrian walkways.

Once completed, the road is expected to significantly cut travel times and stimulate economic growth between the capital and Kiambu.

Tender cancellations are not uncommon for large infrastructure projects and can arise from a variety of factors including funding uncertainties, procurement disputes, design changes, or shifts in policy direction.

The government of Kenya has commitment from China through the China Export Import (Exim) Bank to finance the cost of the capacity enhancement of the road.