Who's fooling whom on JKIA deal? Chirchir triggers more questions

The government has denied contracting controversial businessman Wicknell Chivayo’s firm IMC Construction Kenya the contract to modernise and expand the Jomo Kenyatta International Airport (JKIA), and further said the project amount is in the region of Sh154 billion. 

Reports emerging this week across different media indicated IMC Construction, in a joint venture with China Construction Communication Company (CCC), had won the tender to upgrade the airport at a cost of Sh375 billion ($2.9 billion). Other reports indicated that the project would cost Sh180 billion. 

Transport Cabinet Secretary Davis Chirchir on Wednesday refuted the reports, saying the cost would not exceed Sh154 billion and that the government was still evaluating the tenders. He said Chivayo’s firm was not among the bidders or in any of the joint ventures that had submitted their bids.

Despite the denials, multiple sources told The Standard that the contract amount would exceed Sh154 billion, explaining the construction works have been split into two phases, the first component costing about Sh150 billion. A later phase is expected to be in the region of Sh160 billion. 

The split, the sources explained, was necessitated by China’s policies governing the country’s State-owned entities undertaking works overseas. The rules require contracts of over $1 billion to be subject to strict and lengthy approval processes. Such a requirement resulted in the splitting the Rironi-Mau Summit road into two. The project, which is projected to cost about $1.5 billion, was initially to be handled by the consortium of NSSF and CRBC was split on account of the China’s rules, with the NSSF-CRBC consortium taking about half of the project from Rironi to Gilgil and the other one by Shandong Hi-Speed Road and Bridge International Engineering Company.

Chirchir, however, refuted the reports and said the government is still evaluating the bids for the firm to upgrade JKIA, a facility he noted is in dire need of modernisation to cope with demand.

“The government does not anticipate the contract award to exceed Sh154.2 billion,” he said, noting that benchmarked against comparable airport developments in the region shows the projected cost represents a competitive and reasonable investment for a project of such scale.

“It is important to appreciate that this procurement is not solely for a construction of a new passenger terminal, rather it encompasses a rehabilitation of the existing terminals and airfield… and the construction of a new green field terminal,” he said.

A source, however, said the committee is waiting for the 14-day legal window for any complaints to finalise the tender.

According to the tender documents, the initial phase of improving the existing terminals and airfield is set to be completed within one year and three months (457 days). The development of the new passenger terminal building and associated landside, airside and support facilities is expected to take three years (1,095 days), which would mean the greenfield terminal building would be ready for use in July 2029.

“The current terminal will be expanded from the 7.5 million passenger capacity to 12 million and the new terminal will handle 10 million passengers per year,” said Chirchir, adding that this will increase JKIA’s capacity to more than 22 million passengers, the traffic that the airport is projected to have by 2045.

Designed to handle 7.5 million passengers per year, traffic at JKIA has outstripped this capacity. In 2024, the airport handled 8.6 million passengers, according to data by Kenya Airports Authority (KAA).

Passenger numbers going through the airport has been growing at an annual rate of 5.3 per cent, which KAA noted is a relatively high growth rate. Traffic is projected to grow to 13 million passengers annually by 2030 and further to 22.3 million by 2045.

KAA noted that JKIA has insufficient capacity to accommodate the anticipated traffic growth, particularly the projected demand for the year 2027, which exceeds the capacity limits, calling for an immediate upgrade of the airport.

“The inability to meet this demand poses significant risks to service quality, operational reliability, and the airport’s competitiveness as a regional hub,” said KAA in the Masterplan for JKIA that it published in February.

“Given the constraints, an immediate upgrade of the runway infrastructure is essential to address the shortfall and ensure seamless operations beyond 2027. The upgrade will not only alleviate current capacity challenges but also position JKIA to handle the ultimate demand forecast for 2045, which requires a robust and scalable airside infrastructure.”

Chirchir said the government would use a mix of concessional and commercial loans and locally mobilised funds to build the airport. “The government is working on structuring a financing model and has onboarded Trade Development Bank and the African Finance Corporation as lead arrangers to structure the financing,” he said.

The project is to be funded through leveraging of airport-based revenue streams. The arrangers will crowd in Development Financial Institutions (DFIs) and commercial banks.

The government has in the past said it planned  to securitise the Air Passenger Service Levy.