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Kenya Gets $600 Million From World Bank for Infrastructure

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June 21 (Bloomberg) -- The World Bank is lending Kenya $600 million to upgrade Nairobi’s metropolitan infrastructure and modernize the water and sewer systems to keep up with rapid growth in the East African nation’s cities.

The bank will give $300 million alongside $330 million from the government to improve sewers, roads, public spaces and other services in Nairobi, the capital, World Bank Country Director Johannes Zutt said in an e-mailed statement today.

“Migration to the city is continuing at a rapid pace,” he said. The project will help meet the growing infrastructure demand “so that it remains a livable and business-friendly city as well as an engine of future economic growth.”

Nairobi, the region’s financial and commercial hub, is home to 17 percent of Kenya’s population, according to the World Bank. The city contributes 60 percent of the gross domestic product in East Africa’s largest economy, which generated $32.2 billion in 2010, according to the World Bank.

“The mass urbanization will require connectivity with 13 commuter rail stations proposed for construction, upgrading public infrastructure and constructing and rehabilitating strategic roads,” Finance Minister Robinson Githae told reporters today in Nairobi.

Kenya will also receive a $300 million loan to upgrade water and sanitation systems in its biggest cities and fight drought, Zutt said. Drought-related damage from 2008 to 2011 cost Kenya $12 billion, he said. The World Bank has already invested $150 million in the project, which started in 2007.

Both loans are for 40 years and have a grace period of 10 years, Zutt said.

To contact the reporter on this story: Johnstone Ole Turana in Nairobi at jturana@bloomberg.net

To contact the editor responsible for this story: Bryson Hull at bhull5@bloomberg.net

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