World Bank approves 100 mln dollars for Kenya's municipal reforms

22:15, May 11, 2010      

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The World Bank has approved a credit of 100 million U.S. dollars to improve service delivery in Kenya's municipalities.

The International Development Association (IDA) credit for the Kenya Municipal Program approved by the Bank's Board of Executive Directors on Tuesday will focus on strengthening local governance, institutions, and physical infrastructure, with the ultimate objective of improving services delivered to Kenyans in the 15 largest municipalities.

The Bank said in a statement received on Tuesday that the funds will also improve the viability of the five largest cities and all provincial capitals.

"Kenya's municipalities are critical to economic growth and regional equity but are operating far below their potential, due to infrastructure bottlenecks, weak finances and poor management," said Johannes Zutt, the country director for Kenya. "Rapid urbanization has left Kenyan cities with a huge unmet demand for critical infrastructure and basic services, and this has constrained the productivity of businesses and negatively impacted the quality of life of residents."

The Municipal Program will support Kenya's Vision 2030, which identifies urbanization as one of the key development challenges, and will deepen the reforms that the government has undertaken since 1996 to strengthen accountability by local authorities.

It will also strengthen the capacity of municipalities to cope with the rising demand for quality services arising from the rapid increase in urban population.

In 1999, Kenya's urban population was about 10 million people or 35 percent of the country's population. The five largest cities, including Nairobi and Mombasa, accounted for a third of the urban population.

It is estimated that this population will rise to 16.5 million people (45 percent of the population) by 2015 and increase further to 23.6 million people or 54 percent of the population by 2030. "The urban transition in Kenya will play a critical role in determining the country's growth prospects and social stability," said Sumila Gulyani, Task Team Leader for the program. "The government recognizes that the quality of life in cities can not improve without strong performance of the level of government that is closest to citizens," she said.

The Bank funding is part of the 165 million dollars that is being invested in the program by the government and development agencies.

Other partners in the program are the Swedish International Development Agency (SIDA) and Agence Francaise de Developpement (AFD)--the French international development agency.

The program is the first World Bank project that will underpin the transformation of the urban and local government sector.

Two other projects are under consideration--an Informal Settlements Improvement Program, which will focus on improving the quality of life in Kenya's rapidly-expanding slums, and the Nairobi Metropolitan Services Project, which will strengthen the development potential of Kenya's largest and economically most important urban conurbation.



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