NAIROBI, Kenya, Jan 15 – The Kenya Airports Authority (KAA) and Afro Asia Investment Corporation of Qatar have entered into a Sh27.7 billion investment agreement that will see the development of an expo and convention centre within the airport.
This is one of the largest foreign direct investments the country has attracted for a long time.
KAA Chairman Erastus Mwongera said the development, which will consist of two 5 and 4-star hotels, a modern convention centre, a 5 star tourist hospital and bonded warehouses among other things will be constructed 100m from the airport.
“This development is as a result of the KAA strategy programme to attract private investors to develop Jomo Kenyatta International Airport (JKIA) into a hub,” Mr Mwongera said.
He elaborated that the development would be constructed on a 90-hectare piece of land that will be provided by the Authority.
Afro Asia Corporation Director Haj Mohammed Yassin revealed that negotiations for the project have taken three years to complete having begun in 2005, and added that the agreement would work under a Build Operate and Transfer arrangement.
Mr Yassin said the development would consist of over 200 warehouses and very many exhibition centres, with the intention of attracting traders who buy goods from Singapore, China or Malaysia from the region to the country.
He said plans are that over 50 countries will be able to exhibit their goods at the airport.
At the same function, KAA Managing Director George Muhoho said the ground breaking ceremony should be held in the next 18 months, with construction targeted to be complete in a period of two years.
“From now on consultants, architects and surveyors should be on the ground, working to see the project through,” Mr Muhoho said.
He relayed that the length of the concession was 80 years – a duration that was informed by the investment the company is putting in.
“The benefits to the government will be huge foreign direct investment, for Kenyans the investment will create 5,000 direct jobs and a multiplier effect within various sectors. We the Kenya Airports Authority are going to share the gross income the development will make,” he said.
The MD further revealed that the Authority would collect a nominal rent of Sh18 million to be reviewed each year.
“There is no question that this is an investment of the magnitude that would be sought by any country, anywhere,” he reiterated.
On the other hand, Mr Muhoho defended the authority over delays in the ambitious JKIA expansion program, arguing that the Authority is doing the best it can under its mandate.
“This airport has had very many issues. Thank us for having started the upgrade. Since it was built in 1978, we haven’t had an extra toilet built!”
He noted that the Authority has finished with stage one of the expansion process, has advertised for stage two, and will be advertising stage three in the next two months.
“We are not saying we don’t have a problem, it’s a question of the time it takes to realise a project of this magnitude,” he explained.
Meanwhile, the MD has insisted he is still firmly in office. His assertion comes a day after allegations that he had been sent home by the KAA board, over allegations of irregularities in the on-going JKIA expansion project.
“I am here and I signed this document as Managing Director Kenya Airports Authority. I would like to know from you or from whoever, where the story came from because it definitely did not come from us,” he said.