Kenyan government risks losing the lucrative Mombasa port to China should the country fail to repay huge loans advanced by Chinese lenders.
In November, African Stand reported on how Kenya is at high risk of Losing strategic assets over huge Chinese debt and just after a few month the Chinese are about to take action.
The loans have been granted for the development of the Standard Gauge Railway (SGR).
Also at stake is the Inland Container Depot in Nairobi, which receives and dispatches freight hauled on the new cargo trains from the seaport.
Implications of a takeover would be grave, including the thousands of port workers who would be forced to work under the Chinese lenders.
Management changes would immediately follow the port seizure since the Chinese would naturally want to secure their interests.
Further, revenues from the port would be directly sent to China for the servicing of an estimated Sh500 billion lent for the construction of the two sections of the SGR.
Precedent
In December 2017, the Sri Lankan government lost its Hambantota port to China for a lease period of 99 years after failing to show commitment in the payment of billions of dollars in loans.
The transfer, according to the New York Times, gave China control of the territory just a few hundred miles off the shores of rival India.
It is a strategic foothold along a critical commercial and military waterway.
“The case is one of the examples of China’s ambitious use of loans and aid to gain influence around the world and of its willingness to play hardball to collect,” says the New York Times of December 12, 2017.
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