Chirchir: Why we need a foreign investor to upgrade JKIA

Transport Cabinet Secretary Davis Chirchir has defended the Kenyan government’s plan to seek a foreign investor to modernize Jomo Kenyatta International Airport (JKIA). According to Chirchir, financial constraints have hindered the country’s efforts to upgrade the airport, which has been in existence for over 30 years. With its current capacity struggling to keep pace with increasing flights and cargo, Chirchir emphasizes the urgent need for modernization to maintain JKIA’s status as a key aviation hub in the region.

JKIA has been grappling with challenges for years, particularly since plans to construct the Green Field Terminal in 2012 fell through due to funding issues. This inability to secure sufficient resources has left the airport in a state that no longer meets the demands of a modern, competitive aviation facility. Recently, the airport’s shortcomings were starkly highlighted by roof leaks during the El Niño period, which Chirchir described as an embarrassment to the nation.

“The challenge that we have faced over time from early days in 2012 when we wanted to put up the Green Field Terminal has been with funding,” Chirchir stated, underscoring the long-standing financial barriers to upgrading the airport.

The current capacity of JKIA, originally designed to handle about 2.5 million passengers per year, has been stretched far beyond its limits, with passenger numbers now exceeding 6.5 million annually. The aircraft movements (ATM) have also increased significantly, reaching over 72,700 per year, and are expected to surge to 195,000 by 2030. This growth in air traffic further amplifies the need for a modernized facility capable of accommodating the projected increase in flights and passengers.

To address these challenges, Kenya has engaged India’s Adani Group to redevelop the airport. This move, however, has sparked protests among Kenyans and aviation workers, who recently staged a significant work boycott that disrupted key services at JKIA. The concerns stem from fears over potential job losses and the implications of foreign control over a critical national asset.

Despite the opposition, Chirchir maintains that the partnership with Adani Group is necessary to secure the investment required to modernize JKIA. He explained that under the Public Private Partnership (PPP) Act, the government is permitted to enter into agreements with private investors to undertake essential infrastructure projects. Adani’s involvement is classified as a Privately Initiated Proposal (PIP), which allows private entities to propose and fund infrastructure projects under specific negotiated terms.

Chirchir elaborated on the negotiation process, emphasizing the importance of balancing the debt-equity ratio to ensure the deal is financially sustainable. “We negotiate on the debt-equity ratio, ordinarily equity is expensive and because of this we do not want the equity ratio to be significantly high,” he said. This careful negotiation aims to protect Kenya’s interests while still securing the necessary investment.

Chirchir argues that modernizing JKIA is not just about improving facilities but also about positioning Kenya to remain competitive in the regional and global aviation markets. As a major aviation hub serving many countries, upgrading JKIA is essential for attracting more visitors and enhancing Kenya’s capacity to handle growing air traffic demands.

The plan to bring in a foreign investor like Adani Group reflects the broader challenges faced by many developing countries in funding large-scale infrastructure projects. While the proposal has faced resistance, Chirchir and the government believe it is a necessary step towards achieving the modernization needed for JKIA to meet current and future demands.

In conclusion, the government’s decision to seek foreign investment for JKIA’s upgrade is driven by the pressing need to modernize the airport and ensure it can handle increasing passenger and aircraft numbers. Despite the controversies, Chirchir insists that such partnerships are essential for overcoming financial constraints and securing the future of Kenya’s primary international gateway.