The Kenyan government has initiated a new strategy to address a significant backlog of stalled road projects, a move that is breathing life back into the construction industry and local economies.
The administration inherited 580 stalled road projects with pending bills amounting to Ksh. 175 billion, a financial burden that had crippled the construction sector for years.
Many contractors, some waiting for payment for up to nine years, had been forced to abandon their sites, leading to the collapse of businesses and widespread job losses.
Faced with limited fiscal space, the government opted for a novel debt-free financing solution known as securitisation.
Approved by the Cabinet in April 2025, this model allows the Kenya Roads Board (KRB) to raise funds by leveraging a portion of its future income from the Road Maintenance Levy Fund.
Specifically, the KRB pledged Ksh. 7 out of every Ksh. 25 collected per litre of fuel over the next decade to secure the necessary capital.
This innovative approach provided immediate funding without increasing the national debt.
The impact of this initiative has been swift and significant. By July 2025, over 393 of the 580 previously stalled road projects had resumed.
This revival is not just about concrete and tarmac; it’s about restoring livelihoods and revitalizing communities.
The resumption of work has brought back thousands of jobs for contractors, engineers, suppliers, and casual labourers, providing a crucial source of income for many families.
The previous delays had led to severe consequences. Contractors were unable to continue on credit, and many small and mid-sized businesses collapsed under the financial strain of overdue payments, loans, and interest penalties.
The stalled projects also created a daily challenge for citizens, with incomplete roads causing increased travel times, vehicle damage, and heightened risks from hazards like exposed culverts and unmarked diversions.
With the allocated Ksh. 175 billion for phased payments, the government is not only clearing a long-standing financial backlog but also enabling new infrastructure commitments.
The securitisation model is seen as a practical and people-focused solution that is restoring confidence in the construction industry and sparking a new wave of productivity and economic activity across the country.
This marks a critical step forward in ensuring that vital infrastructure projects, regardless of their origin, are completed for the benefit of all Kenyans.
