The government is apparently in talks with the United Arab Emirates (UAE) to lease a portion of the problematic Galana Kulalu Irrigation Scheme.
According to Bloomberg, the government is in advanced talks with an Abu Dhabi-based agricultural group to lease 200,000 acres for approximately Ksh103.39 billion.
According to the international journal, the Principal Secretary for Irrigation, Ephantus Kimotho, expects the agreement to be signed early next year.
“We are still negotiating, but we might soon sign a memorandum of understanding,” Kimotho told Bloomberg in a phone interview.
Kimotho did not disclose any information on the topic, which comes on the heels of the government’s efforts to recruit more private investors to the country.
Despite an ambitious plan to develop all of the land, the initiative, which covers around 1.75 million acres, has yet to take off.Currently, just 10,000 acres of land are under cultivation.
This year, the government provided Ksh100 million to complete the project, which has received millions virtually every fiscal year since 2014.With a total expenditure of Ksh7.9 billion, the project is one of the country’s white elephants.
The irrigation project, located between Kilifi and Tana River Counties, is part of the country’s Vision 2030 and serves as a road map for achieving food security.
The company that is negotiating with Kenya specializes in the cultivation, production, and marketing of animal feed and necessary human food commodities such as rice, flour, fruits and vegetables.
The Abu Dhabi National Wealth Fund has financed the company’s global expansion, which now includes a land bank of around 350,000 acres spread over four continents.
Its infrastructure consists of feed processing and baling facilities, rice and flour milling factories, and dairy farms.
The timing of the transaction is sure to raise eyebrows, as President William Ruto’s government is already in talks with the UAE about a Ksh193 billion loan.
According to the same publication, the first tranche of payout will be worth Ksh90 billion in January of next year, with the remaining funds to be channeled to Kenyan banks thereafter.
It is unknown whether the transaction will be a public-private cooperation or a strait land deal.
The government has been in turmoil over the Adani Group’s proposed PPP project for the construction of power transmission lines and the expansion of the Jomo Kenyatta International Airport (JKIA).
“It is important to appreciate that the partnership between the public and the private sector gives us a win-win outcome to deliver public services using the efficiency and investment of the private sector,” stated Ruto in October.
