Frost & Sullivan Identifies Growth in Trade as Key Catalyst in Kenya's Infrastructure Development

CAPE TOWN, South Africa, March 22, 2012 /PRNewswire/ -- The rapid growth in trade has been instrumental in driving infrastructure development throughout the east African region. An effective infrastructure system facilitates trade and regional development, by enabling the free flow of goods and services. Kenya's infrastructure, particularly roads and transport networks, are currently undergoing extensive expansion and refurbishment in order to increase capacity and successfully cater to the growth in trade.

New analysis from Frost & Sullivan (http://www.environmental.frost.com), African Infrastructure Tracker: Kenya's Infrastructure Sectors, finds that Kenya's transport infrastructure has expanded rapidly, due to the increased volume of goods from the Far East region. Most of this trade has been facilitated by the country's road and rail infrastructure. The research covers the road, rail, airport, port, energy and power, telecommunications, water and sanitation, housing, education and healthcare infrastructure sectors.

"The rapid increase in the volume of goods entering Kenya through the port of Mombasa - the main port of entry into the east African region - has significantly contributed to the expansion of the country's road and rail networks," notes Frost & Sullivan's Environmental and Building Technologies Research Analyst Derrick Chikanga. "The significant expansion in the volume of goods handled has underlined the need to improve on the country's road and transport networks in order to facilitate the steady flow of goods into the country."

Since 2005, the volume of goods handled by the Port of Mombasa has increased by approximately 46.0 per cent. Furthermore, the port is currently undertaking various expansion projects in order to more than double its handling capacity. This is expected to exert further pressure on the current transport infrastructure.

Despite the poor state of Kenya's road and rail network, the country still lacks adequate funding to undertake major rehabilitation projects. Most of the major projects are funded by a few development organisations in collaboration with the Government of Kenya. This has limited the extent of infrastructure development in the country.

"The majority of Kenya's projects are funded by the Japan International Cooperation Agency (JICA), the European Union (EU) and the African Development Bank (AfDB)," emphasises Chikanga. "These three organisations contributed more than 50.0 per cent to total donor funds in 2010, which demonstrates the limited external funding for Kenya's infrastructure development projects."

Despite the limited financial support, various opportunities currently exist in the country's road and transport infrastructure sector. The concept of public-private partnerships is currently being embraced by the Government of Kenya. This is aimed at encouraging greater participation in infrastructure development by private organisations.

"The ability to establish close ties with various government departments will be critical in undertaking government projects in Kenya," advises Chikanga. "Most government departments currently award tenders to companies that they trust and are closely linked to."

If you are interested in more information on this study, please send an e-mail with your contact details to Samantha James, Corporate Communications, at [email protected].

African Infrastructure Tracker: Kenya's Infrastructure Sectors is part of the Environmental Growth Partnership Services programme, which also includes research in the following markets: African Infrastructure Tracker: Uganda's Infrastructure Sectors, African Infrastructure Tracker: Namibia's Infrastructure Sectors, African Infrastructure Tracker: South Africa's Transport Sectors. All research included in subscriptions provide detailed market opportunities and industry trends that have been evaluated following extensive interviews with market participants.

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African Infrastructure Tracker: Kenya's Infrastructure Sectors
M6BE-15

Contact:
Samantha James
Corporate Communications – Africa
P: +27 21 680 3574
F: +27 21 680 3296
E: [email protected]

http://www.frost.com

SOURCE Frost & Sullivan