Amid public uproar over the proposed lease of Jomo Kenyatta International Airport (JKIA) to India’s Adani Group, National Treasury Cabinet Secretary John Mbadi has come out strongly to defend the Public-Private Partnership (PPP) strategy behind the deal. Mbadi’s comments reflect a growing debate in Kenya about how the country should finance its critical infrastructure projects and whether foreign entities like Adani should be allowed to play a role in these efforts.
The Importance of Infrastructure Upgrades at JKIA
Jomo Kenyatta International Airport (JKIA) is the busiest airport in East Africa and serves as a vital transportation hub for the entire region. However, in recent years, there has been increasing concern that its infrastructure is aging and no longer competitive on the global stage. Data from the Airports Council International (ACI) highlighted JKIA’s importance in the region, showing that it handled 6.56 million passengers in 2022, placing it among the top 10 busiest airports in Africa. Yet, despite these impressive numbers, JKIA has struggled to keep up with newer and more modern airports in neighboring countries like Ethiopia and Rwanda.
According to Mbadi, the need to upgrade JKIA is urgent. He noted that the airport’s deteriorating state puts Kenya at risk of losing its competitive edge to neighboring countries. “Rwanda has developed a serious airport, Ethiopia has an airport. Kenya cannot lag behind. We’re losing our competitiveness as a hub,” Mbadi remarked. This pressure to maintain regional dominance has led the Kenyan government to explore alternative financing mechanisms, such as PPPs, to fast-track infrastructure development without overburdening the country’s already strained public finances.
Public Private Partnerships (PPP): A Solution or a Problem?
The PPP model is not new to Kenya, but its implementation has often been met with suspicion. For many, the idea of foreign investors taking over critical public assets raises concerns about transparency, accountability, and national sovereignty. The Adani Group, an Indian multinational conglomerate with interests ranging from ports to energy, has proposed a Ksh. 238 billion deal to upgrade JKIA and manage its operations for 30 years before returning control to the Kenyan government. This deal is currently under audit, and no formal agreement has been signed.
Despite the controversy, Mbadi has made a concerted effort to explain the benefits of PPPs to the Kenyan public. Speaking at a Kenya Bankers Association (KBA) exhibition, the Treasury CS emphasized that PPPs allow the government to complete or renovate large projects by involving the private sector, without drawing directly from the national exchequer. This, he argued, eases the burden on taxpayers, who are already grappling with the effects of inflation, rising fuel prices, and high living costs.
“We must look for alternative financing and therefore PPP, new as it is, we must make the citizens of Kenya understand PPP and understand that when we give out a project to be done through PPP it is not selling,” Mbadi said, trying to quell fears that such deals amount to privatization of public resources. “It is about concessioning a project to a private developer who works with us collaboratively to ensure we have infrastructure that is competitive.”
PPP agreements allow governments to leverage private sector investment to finance public infrastructure projects. The private partner typically takes on some level of risk and, in return, manages the asset for a set period, often with the aim of making a profit. In the case of JKIA, the proposed deal with Adani would involve a 30-year lease, after which the airport would revert to government control.
Concerns Over the Deal: Opaque Negotiations and National Sovereignty
Despite Mbadi’s reassurances, many Kenyans remain skeptical of the proposed JKIA lease. The main concern lies in the opaque nature of the negotiations. Critics argue that the government has not been transparent about the terms of the deal and that handing over control of one of the country’s most critical infrastructure assets to a foreign entity could have long-term consequences for Kenya’s national sovereignty and security.
Additionally, some have questioned whether Adani, given its controversial reputation in India and its extensive business portfolio, is the right partner for such a critical project. Adani Group has faced allegations of environmental degradation and accusations of monopolistic practices in its home country. The fear is that similar issues could arise in Kenya if the company is allowed to take over operations at JKIA without proper oversight.
The Kenyan government, however, has tried to address these concerns, stating that the deal is still in the auditing stage, and no agreement has been finalized. “The deal is still in the auditing stage,” the government clarified, responding to public outcry. This statement suggests that there is still room for public input and for the government to reassess the terms of the lease before making a final decision.
Learning from Regional Competitors: The Case for PPPs in Africa
One of Mbadi’s main arguments in favor of the PPP deal is that neighboring countries are already using similar models to upgrade their own infrastructure. Rwanda and Ethiopia, for example, have made significant strides in developing their aviation sectors, positioning themselves as regional hubs. Ethiopia’s Bole International Airport has undergone major expansions in recent years, and Rwanda’s new Bugesera International Airport, which is being built through a PPP agreement, is expected to be a game-changer for the country’s tourism and business sectors.
Mbadi warned that Kenya risks falling behind if it does not take similar steps to modernize its airports. “Whether it is Adani or not, we must agree that someone must do our airports. It is not just airports alone, major projects. Let us not shy away from engaging Kenyans,” he said, urging the public to embrace the PPP model as a way to fast-track infrastructure development.
For Kenya, maintaining its position as a regional aviation hub is crucial not only for its economy but also for its geopolitical standing. The aviation sector contributes significantly to the country’s GDP through tourism, trade, and employment. If JKIA continues to fall behind in terms of infrastructure and capacity, Kenya could lose out on valuable business to neighboring countries, which are positioning themselves as alternative gateways to East Africa.
Balancing Economic Development with Public Accountability
The debate over the JKIA lease deal highlights a broader issue facing many African countries: how to finance critical infrastructure projects in the face of limited public resources. While PPPs offer a potential solution, they are not without their risks. Ensuring transparency, accountability, and public engagement in the negotiation and implementation of these deals will be essential to their success.
For the Kenyan government, the challenge will be to strike a balance between attracting foreign investment and protecting national interests. The ongoing audit of the Adani deal provides an opportunity for the government to address the public’s concerns and ensure that the project is beneficial not only for the private sector but for all Kenyans.
At the end of the day, as Mbadi pointed out, JKIA must be upgraded if Kenya is to remain competitive in the global aviation industry. The question is not whether the airport should be modernized, but how best to do it. Whether through a PPP with Adani or another investor, the government will need to ensure that any deal is transparent, fair, and in the best interest of the country.
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