1.
INFRASTRUCTURE
AND
ECONOMIC DEVELOPMENT IN KENYA

Prepared and presented by group 9

2.
Infrastructure consists of
the following:
1. Transport
2. Telecommunication
(Information and
Communication
Technology ICT)
3. Water supply and
sanitation
4. Energy etc…
INTRODUCTION
 This topic reviews the linkages between
infrastructure and economic development.
 The main component is that economic
growth arises from investment in
infrastructure.
 Policy makers use infrastructure as a tool
to realize economic benefits.
 The quality of infrastructure and the level
of investment in physical infrastructure has
a direct correlation with the level of
economic growth.
 Intensive investment in physical
infrastructure translates to higher economic
benefits e.g. application of modern
technology in manufacturing industry leads
to increased productivity of goods and
services.

3.
1.Water supply and sanitation
a. Water Supply
Water supply and
sanitation in Kenya
is characterized by
low levels of access,
particularly in the
urban slums and
rural areas, as well
as poor services and
quality in form of
intermittent water
supply.
 The development of infrastructure has therefore led to
increase in distribution of water to various places in
different regions.
 Through the water Act No. 8 the water sector is
undergoing various reforms contrary to previous years
where it was the responsibility of a single company:
The National Water Conservation and Pipeline
Corporation, and a few local utilities established since
1996.
 After enacting the Act service provision was gradually
decentralized to 117 Water Service Providers (WSPs).

4.
a. Water supply (Continued…)
Today water is
distributed to many
regions all over the
country for various
uses due to
improvement in
pipeline services
i.e. for domestic
purposes,
irrigation in farms,
in industries and
factories etc…
 According to Joint Monitoring Programme
for Water Supply and Sanitation (JMP)
estimates, access to improved water
sources in urban and rural areas have
increased by 20%.

5.
b. Sanitation
Countrywide estimates
for 2008 by the Joint
Monitoring Programme
for water supply and
sanitation (JMP)
indicated that 31% (27%
of urban and 32% of
rural) Kenyans had
access to private
improved sanitation
(This includes flush,
pour flush toilets
connected to a piped
system, septic tanks, VIP
latrines and pit latrines).
 In Nairobi, sanitation coverage was
about 23% in 2006 – 2007.
 The Kenyan integrated household
Budget Survey later reported a
much higher sanitation
improvement by 84%.

6.
2. Transport
Economic infrastructure is vital for economic growth and
poverty reduction since it plays a key role in enhancing
competitiveness thereby facilitating trade and integrating
countries to the rest of the world. This involves roads,
railway, air transport and seaports.

7.
a. Roads
Road infrastructure
provides basic
national and
regional
connectivity to
major towns and
country capital in
the interior opening
up unconnected
regions to trade and
investments like
companies and
estate apartments.
 Road transport improves access to goods and
services delivery, reducing loss of goods in terms of
damage, increased productivity and time
performance through access to input of raw
materials and finished products due to reduction in
congestion on roads because of construction of
bypass like the Northern Bypass, Eastern Bypass
and the Southern Bypass.
 Road transport has also provided employment
opportunities hence increased per capita income.

8.
a. Roads (Continued…)
 Investment in road infrastructure
has led to sustainable growth and
development of the economy
which arises due to the multiplier
effects of government spending
on infrastructure
 Improved road transport therefore
shows a positive impact on
economic growth.
 Transport infrastructure has
undergone major upgrades over
the past 5 years in order to
support the high trade demand in
the East African region. The
Nairobi Southern bypass, for
example, was commissioned in
2012 and is already 40%
complete.

9.
b. Railway
“Most rail networks in
Kenya are as old as 100
years and have not been
upgraded since they were
first constructed in
colonial days due to lack
of funds. These networks
cannot meet the demands
of modern times, observes
the African Development
Bank (AfDB).
Most lines are low-speed,
small-scale,
undercapitalized networks
carrying low axle loads.”
 Kenya’s railway corridor is of strategic
importance to the region linking the port of
Mombasa to Nairobi and going to Uganda
and Rwanda.
 The standard gauge railway (SGR) which
is 609km is expected to raise Kenya's GDP
by 1.5% on its completion by 2018.
 The SGR will facilitate movement of bulky
goods easing pressure on congestion in
roads, speed up industrialization through
cheaper transport and establishment of new
service industries.
 Railway development promotes opening up
of most areas and more so creating
employment to the jobless population.

10.
b. Railway (Continued…)
“Kenya’s standard
gauge railway (SGR),
a new rail track that
will stretch from
Mombasa to Nairobi,
is the most ambitious
infrastructure project
in the country since
independence. The
609km-long line is
expected to cost $3.6-
billion, with China’s
Exim Bank footing
90% of the bill and
the Kenyan
government providing
the other 10%.”
- The SGR is part of the grand trans East
African railway project, one of many ‘mega’
infrastructure projects currently under way
in that region.
- It is a direct effort to connect East Africans
and their economies, and in so doing:
 build economies of scale,
 lower the cost of doing business,
 attract foreign investment, and
 ultimately accelerate growth and
development.
- The SGR, which should be completed by
2017, is the first part of the broader Lamu
Port-South Sudan-Ethiopia transport
corridor. This integrated mega-project will
connect countries in the region via oil
refineries, ports and railway lines.

11.
c.Air Transport
In a bid to cement its
position as one of
Africa’s major gateways,
Kenya is building a new
terminal at Jomo
Kenyatta International
Airport in Nairobi.
Dubbed the ‘Greenfield
Terminal’, and financed
largely by the African
Development Bank, the
terminal will cost an
estimated $612-million,
span 178,000 square
meters and handle an
annual 20-million
passengers.
 Kenya is investing in air transport to improve
economic development of the country through the
Greenfield Terminal.
 A successful public-private partnership in air
transport has helped to make the country’s airline
one of the top three carriers in the Sub-Saharan
Africa.
 JKIA is one of the key international gateways into
the continent widening the market for most
Kenya's export products and tourists.
 Air transport is a means of linking Kenya to the
international destinations thereby increasing
economic development of Kenya.
 In addition to this, in 2013 Kenya signed a
financing agreement with the French Development
Agency to upgrade Moi International Airport in
Mombasa. This is a major entry point for tourists
visiting the coastal city, with more than a dozen
airlines flying in directly from Europe.

12.
d. Seaports
Kenya is endowed with
seaports such as the
ports of Lamu,
Mombasa, and Malindi
which open international
markets facilitating
exports and imports of
products enhancing
trading activities.
This generates
government revenue
through custom duties
levied on imported goods
enabling the country to
provide essential goods
and services (Public
Utilities).
 Inland transport like that of Kisumu
enables regional corporation opening
economic development in the East
African Countries.

13.
e. Energy
Energy is a foundation stone
of the modern industrial
economy. Energy provides an
essential ingredient for
almost all human activities:
it provides services for
cooking and space/water
heating,
lighting,
health,
food production and
storage,
education,
mineral extraction,
industrial production and
transportation.
- There are diverse energy sources some of
which include the following:
 Hydropower (HEP) e.g. in Masinga dam
 Geothermal Power e.g. in Olkaria
 Wind energy from wind mills e.g. Ngong
Hills
 Solar Power using solar panels e.g. in
Arid and semi arid lands of North Eastern
Kenya
 Biomass, and
 Biogas.
- Energy consumption is important to drive
a country’s development process in a
number of ways.

14.
e. Energy (Continued…)
Modern energy services are a
powerful engine of economic
and social development, and
no country has managed to
develop much beyond a
subsistence economy without
ensuring at least minimum
access to energy services for a
broad section of its
population.
Throughout the world, the
energy resources available to
them and their ability to pay
largely determine the way in
which people live their lives.
Nevertheless, it is critical to
recognize that what people
want are the services that
energy provides, not fuel or
electricity per se.
 The use of biomass energy has made charcoal a cash crop
contributing to a monetized economy, and in some urban areas,
there are active markets in local wood fuels.
 The concept of energy diversity is responding to uncertainty
and this underpins energy security which helps deliver
economic performance and improves the quality of life.
 Availability of adequate supply of energy helps the industries
to reduce production costs of manufactured and processed
goods and subsidized service delivery thereby maximizing on
production.
 Energy diversity provides additional options for substitution on
supplies I which a country is over-reliant hence minimize
losses on interruption in supply.
 Energy production process creates employment opportunity to
a larger number of people.
 Availability of energy has made it possible to use the locally
available resources in the production process like it is in the
welding and Jua Kali industries.
 Use of energy in the agriculture sector promotes productivity
hence a food security policy.
 Use of energy in rural Kenya has enhanced rural economic
development as rural areas increase output per household

15.
f. Information and Communication Technology
(ICT)Since 2000 Kenya's
economy has grown at
an average of 3.7%.
Without ICT this growth
would have been at
2.8% and per capita
income would have
stagnated.
Kenya has been ranked
among the top 5 African
countries with the
fastest growth in
telecommunication
infrastructure in mobile
money innovation. The
engine behind the rapid
growth has been mobile
telephony.
 In the mobile telephony, mobile money transfer
(MPesa) has driven change in the business model of
most financial institutions in the country.
 Mobile money agents represents 3/4s of the total
financial access and they are major drivers in
bringing financial access points close to the
population.
 INFORMATION and communication technology
has been recognized as a powerful enabler for
economic and social development.
 ICT enhances economic growth, social inclusion,
increase health and education services and
improving governance at all levels.
 The United Nations MDGs identifies the potential
of ICT for development and MDG target-8 calls to
develop a global partnership for development and in
corporation with the private sector make available
the benefits of new technologies especially in ICT.

16.
f. Information and Communication
Technology (ICT) Continued…
Mobile Internet access
revenue will soar at a 12.7%
CAGR, from US$236.83bn in
2014 to US$441.47bn in
2019, accounting for close to
two out of every three dollars
spent on Internet access in
that year. In 2019, Kenya and
South Africa will see more
than 75% of total Internet
access revenue derived from
mobile, with South Africa at
an industry-leading 90.7%.
 The internet has also led to economic
development with servers to that have a proxy to
e-commerce has interlinked buyers or potential
customers to the sellers from all over the world
hence facilitating trading activities promoting
economic development.
 In education sector ICT has enabled more learners
to affordably access learning materials at a lower
cost. This area has a potential growth boosting
online education and facilitating massive and
online content.
 ICT has become the highest distributor platform
of providing public and private services to
millions of people in rural and poor areas, market
information, financial services and health sectors
have largely been unavailable for long.
 With the growth of ICT, in particular high speed
internet, are changing how large companies are
doing business, transforming public service
delivery and democratizing innovation.

17.
CONCLUSION
While cash is crucial for
Kenya’s capital-intensive
projects, land disputes and
security concerns have
provided the most
unexpected challenges,
particularly at the terminus
in Lamu.
Infrastructural
development is beyond
doubt the key aspect of
economic development of
any nation.
There is therefore an urge
to forward our
infrastructural
development level so as to
win the myriads of
economic benefits in the
EAC.
 Infrastructure plays a crucial role in the economic
development of any nation whether developed or
still developing.
 Infrastructure provides basic and solid foundation
on which the development and growth can be
erected.
 Obviously if the foundation is weak and fragile, it
is doubtful that any structure can be built on it.
Super or simple is likely to provide continuous
and stable services for the foreseeable future.
 Once the infrastructural foundation is strong
development is not easily attainable but is also
continuous, stable, quantitative and qualitative.