nairobi- a policy narrative - world bank...nairobi resembles a monocentric city as its most densely...
TRANSCRIPT
Authored by:
Patricia Jones Louise Bernard
Lino Ferreira University of Oxford
Tekla Muhoro Jomo Kenyatta University of Agriculture & Technology, Kenya
March 2016
Copyright © World Bank, 2016
Nairobi- A Policy Narrative
Multi Donor Trust Fund for Sustainable Urban Development
Building African Cities that Work
A study on the Spatial Development of African Citiess
NAIROBI:
A POLICY NARRATIVE
ABSTRACT:
In this policy narrative, we examine the urban development of Nairobi from its pre-colonial pat to the present day. Our analysis covers both the spatial development of the city as well as its economic development. Special emphasis is given to the historical development of the city’s structure of governance, land and housing markets, and transportation networks. To carry out this analysis, we use a wide range of sources including satellite data, historical maps, and geo-referenced economic data.
*This paper is a part of a Global Research Program on Spatial Development of Cities, funded by the Multi Donor Trust Fund on Sustainable Urbanization of the World Bank and supported by the UK Department for International Development.
Patricia Jones
Louise Bernard
Lino Ferreira
University of Oxford
Tekla Muhoro
Jomo Kenyatta University of Agriculture & Technology, Kenya
March 2016
1
Contents
Nairobi at a Glance ............................................................................................................................... 4
Pace and Magnitude of Urbanization .................................................................................... 4
Brief History ................................................................................................................................... 5
Population Density ....................................................................................................................... 7
Why Cities Matter ....................................................................................................................... 10
Structure of the Urban Economy .......................................................................................... 11
References .................................................................................................................................................. 12
Governance ........................................................................................................................................... 14
2.1. Governance in Nairobi .............................................................................................................. 18
2.3 Urban Finance .............................................................................................................................. 19
2.4 County Government Autonomy in Decision Making ..................................................... 19
2.5 Revenue Sources ......................................................................................................................... 20
2.6 Revenue Allocation .................................................................................................................... 20
2.7 Mobilizing Capital: Public Private Partnership and Borrowing ............................... 21
References .................................................................................................................................................. 22
Land and Housing Markets ............................................................................................................. 23
3.1. The Evolution of Land Tenure in Kenya ............................................................................ 23
Pre-colonialism ........................................................................................................................................ 23
The Colonial Period ................................................................................................................................ 23
Post-independence ................................................................................................................................. 23
XXI Century ................................................................................................................................................ 24
3.2. Overview of Current Legislation and Procedures .......................................................... 26
Classification of Land ............................................................................................................................. 26
Acquisition of Private Land ................................................................................................................. 26
Resolution of Disputes .......................................................................................................................... 27
3.3. Challenges Facing Kenya’s Land and Housing Sectors ................................................. 27
Lack of Supply ........................................................................................................................................... 28
High Housing Prices and Limited Access to Finance ................................................................. 29
Complex Bureaucracy and Corruption ........................................................................................... 30
Insecurity of Tenure ............................................................................................................................... 31
Lack of Adequate Infrastructure ....................................................................................................... 32
3.4. Summary ........................................................................................................................................ 33
2
References .................................................................................................................................................. 34
Transport in Nairobi ......................................................................................................................... 36
4.1. Brief History ................................................................................................................................. 36
4.2 Roads .................................................................................................................................................... 36
4.3 Investment in Infrastructure ................................................................................................. 37
4.4 Railways ......................................................................................................................................... 38
4.5 Maritime and Inland Water Transport ............................................................................... 40
4.6 Pipeline Transport ..................................................................................................................... 40
4.7 Air Transport ................................................................................................................................ 40
References .................................................................................................................................................. 41
3
Figures
Figure 1-1: Urban Expansion in Nairobi, 1990-2010 Source: Author’s calculations based
on Landsat Satellite imagery. .................................................................................................................... 4
Figure 1-2: Population Density in Cities across the World ............................................................ 7
Figure 1-3 The Evolution Of Population Density In Nairobi: 1989, 1999 And 2009 ........... 8
Figure 1-4 Population Density In Nairobi In 2009 ............................................................................ 9
Figure 1-5 Population Density In Nairobi ............................................................................................ 9
Figure 1-6 Urbanization & Development ............................................................................................ 10
Figure 1-7 Exports & Development ...................................................................................................... 10
Figure 2-1: Kenya Devolved System .................................................................................................... 17
Figure 2-2: Local governance map ........................................................................................................ 18
Figure 3-1: Percentage of Population at Mid-year Residing in Urban Areas in Kenya, 1950-
2050 .................................................................................................................................................................. 28
Figure 3-2: Time Necessary to Register Property in Selected African Countries and High-
Income OECD Average ............................................................................................................................... 30
Figure 4-1: Investment in Roads, 2002-2010 ................................................................................... 38
Figure 4-2: Commuter Rail Services in Nairobi ................................................................................ 39
4
Nairobi at a Glance
Pace and Magnitude of Urbanization
Nairobi is urbanizing fast. Between 1990 and 2010, its population more than doubled in
size, growing from 1.4 million to 3.2 million inhabitants (UN Population Division, 2015).
As its population has increased, so has its spatial footprint (Figure 1-1). During the past
two decades, the city has extended its built cover, particularly along its eastern rim.
FIGURE 1-1: URBAN EXPANSION IN NAIROBI, 1990-2010 SOURCE: AUTHOR’S CALCULATIONS BASED ON LANDSAT SATELLITE IMAGERY.
Today the population of Nairobi is estimated at 3.9 million but it is expected to expand by
another 3.2 million people by 2030 (UN Population Division, 2015). While Nairobi is
growing fast, Kenya is only about one-third of the way through its urbanization process.
This gives policy makers a window of opportunity to design new policies which avoid the
mistakes of the past. From global experience, we know that urbanization can bring large
benefits to both workers and firms through productivity gains associated with
agglomeration economies. To date, however, the evidence suggests that Nairobi is not
taking full advantage of these benefits.
In this policy narrative, we examine the major policies which have influenced Nairobi’s
economic and spatial development. Special emphasis is given to the historical
5
development of the city’s governance structure, land and housing markets, and
transportation networks.
Brief History
Nairobi is the political and commercial capital of Kenya. It was established in 1896 as a
railroad camp and supply depot during the construction of the Kenya-Uganda railway
which stretched from Mombasa to Lake Victoria. The name Nairobi is likely derived from
the Maasai phrase, “Enkara Nyoirobi”, which means “the place of cool waters” (Rahbaran
and Herz, 2014). The city is located on the Athi River plateau and dissected by many
rivers and streams which were used as drinking sources during colonial times (Medard,
2006).
Nairobi’s first town plan was introduced in 1899—the same year that the train line
reached the city. Its early spatial organization was based on racial segregation. Early
European settlers and railway management lived in the western parts of the city—on the
highlands where the higher altitude kept the mosquitoes at bay. Indian traders and
railway laborers lived in the city’s northern areas and centre so that they could be close
to the expanding railway infrastructure. Native Africans lived outside of the city’s
administrative boundaries—on the dry, plateau where flooding was common and
malarial infection high. Africans were further split by ethnic group as the colonial powers
feared instability arising from ethnic rivalry (Rahbaran and Herz, 2014).
In 1905, Nairobi became the capital of Kenya and British East Africa. For much of its
colonial history the city remained divided. Residential segregation was reinforced by the
master plan of 1927. Segregationist policies extended into economic relations as well.
Access to land and entry into the city was based on race and ethnicity. Africans were
barred from property ownership and forbidden from living within the city’s
administrative boundaries. By 1936 “90 percent of the city was owned by Europeans
while the rest belonged to Asians” (Rahbaran and Herz, 2014, p. 15). Following World
War II, the spatial organization of the city along racial lines was further strengthened by
the 1948 master plan. This plan used rigid zoning laws to construct residential
neighbourhoods separated from commercial activity by large green spaces—an adoption
of the popular “garden city” style of urban planning. The 1948 master plan proposed
extensive road construction to connect these “residential islands” to commercial areas.
While the plan was never fully implemented, the city’s urban footprint—and inefficient
system of roads—can be traced back to this master plan.
Kenya gained its independence from Britain in 1963. At this time, the city was the home
to some 344,000 residents. Over the next 15 years, its population would more than
double, reaching 827,775 inhabitants by 1979 (Medard, 2010). Rapid population growth
placed severe pressure on the city’s infrastructure and services. In response, the
government adopted a new urban plan in 1973. This plan introduced mixed zoning laws
throughout the city. It envisioned Nairobi as a city comprised of “integrated self-
6
contained metropolitan neighbourhoods” situated along transport corridors. Residential,
commercial, and administrative areas were planned within single neighbourhoods to
give residents maximum connectivity to services and jobs. While little of the 1973 master
plan was implemented, its vision of Nairobi stood in stark contrast to the city’s earlier
master plans. Without any effective urban planning, the city grew in a haphazard fashion
for the next thirty years. Much of the residential construction was in single-story slums
and multi-story tenement buildings. “By 1981 over 80 percent of Nairobi’s residents
lived within substandard single rooms in the city in settlements such as Mathare,
Pumwani, Maringo, and Kibera” (Rahbaran and Herz, 2014, p. 15).
The city’s current urban policies continue to neglect its growing slum population.
Instead, city planners have focused on improving infrastructure and business services
within the CBD in an attempt to attract foreign investors to the city. For example, in 2008
the “government published a document called Nairobi Metro 2030: A World Class African
Metropolis. This document…represents visions of skyscrapers, high-speed trains, and
industry” (ibid, p. 15). Security, however, remains an issue in the city. Following the 2003
bombings of the UN Headquarters in Bagdad, the city authorities launched a survey of
Nairobi to identify “safe” areas in the city. These neighbourhoods—called the Blue
Zone—lie to the north and northwest of the city. Many shopping malls, luxury hotels, and
exclusive apartment buildings can be found in this area of the city.
7
Population Density
Compared to Asian cities at comparable levels of economic development, Nairobi is not a
dense city. On average, its population density is about 8,500 people per square kilometre
(Demographia World Atlas, 2015). This density is higher than that in other African
cities—like Addis Ababa, Dar es Salaam, and Kampala (FIGURE 1-2). Part of this gap is
likely explained by the larger population of Nairobi relative to these cities. Recent
research reveals that a doubling of city population is associated with a 19 percent
increase in density (Angel, 2011). For example, Nairobi’s population is about twice the
size of that in Kampala.
FIGURE 1-2: POPULATION DENSITY IN CITIES ACROSS THE WORLD SOURCE: DEMOGRAPHIA WORLD URBAN ATLAS (2015). NOTES: THE ESTIMATED POPULATION DENSITY FOR NAIROBI IS SLIGHTLY HIGHER THAN OUR ESTIMATES RESULTING FROM A
DIFFERENT DEFINITION OF THE URBAN EXTENT.
Nairobi resembles a monocentric city as its most densely populated areas are near the
centre of the city. Figure 1-3. These areas—which include the city’s central business
district (CBD) —have experienced the fastest increase in densification since 1999.
Across Nairobi, differences in population density are negatively correlated with distance
to the city centre and positively correlated with the poverty of its residents. Informal
settlements—such as Mathare North, Kibera, Huruma Estate, Kayole— are the densest
areas of the city with peaks that go up to 70,000 people per square kilometre.
700
3,800
3,900
4,100
4,300
4,400
5,500
5,900
6,000
6,100
6,300
6,600
7,400
7,500
7,700
8,500
9,800
9,800
11,800
12,300
14,800
15,300
18,100
18,300
19,900
32,400
43,500
Atlanta
Paris
Kampala
Durban
Accra
Jakarta
Khartoum
London
Ho Chi Minh City
Shanghai
Maputo
Luanda
Dar es Salaam
Sao Paulo
Addis Ababa
Nairobi
Colombo
Kigali
Casablanca
Lusaka
Abidjan
Manila
Dakar
Bogota
Kinshasa
Mumbai
Dhaka
Average Population Density (population/km2) in Selected Cities
8
Similarly, many housing estates—such as Race Course, Ngara, Shauri Moyo, Pumwani,
Mathare Valley, Eastleigh, Kariobangi, Kaloleni, Bahati, Jericho, Mbotela, Dandora— are
comprised of high-density (and high poverty) neighborhoods.
Most of the affluent areas in Nairobi are situated in the western and northern parts of the
city. These areas include the neighbourhoods of Woodley, Kileleshwa, Kilimani,
Lavington, Bernard, Thomson and Muthaiga. These neighborhoods are characterized by
high income households who live on large plots of land. Similarly, the neighbourhoods of
Karen and Langata, which are situated in the south and south eastern parts of the city,
are mostly high income, low density areas.
Kibera, the largest slum in Nairobi, is located in the south of the city. Its population
density is high (71, 458 people per square kilometre) partly because of its inability to
spread further in terms of land as it borders a golf club to the north and the Ngong Forest
to the west. Mukuru, the informal settlement closest to the city centre, is south of the
industrial area and north of the Mombasa Road. Long lasting informal settlements like
these are the densest informal settlements in the city. However, low density informal
settlements are beginning to develop near the edge of the city. For example, several new
slums have arisen near the Jomo Kenyatta International Airport which lies at the
intersection of the Mombasa road and Eastern bypass. There are also new slums in the
west near Kangemi.
FIGURE 1-3 THE EVOLUTION OF POPULATION DENSITY IN NAIROBI: 1989, 1999 AND 2009
9
FIGURE 1-4 POPULATION DENSITY IN NAIROBI IN 2009
Table 1-5 below depicts the population density gradient for Nairobi. Like most cities,
population density tends to fall as the distance from the CBD increases although this
relationship is by no means monotonic. Density peaks at about 5 to 8 kilometres from
the CBD which is where the settlements of Mukuru and informal Kibera are located,
respectively.
FIGURE 1-5 POPULATION DENSITY IN NAIROBI SOURCE: CENSUS DATA FROM KNBS (2009)
10
Why Cities Matter
Evidence from today’s developed countries and rapidly emerging economies shows that
urbanization is a source of dynamism that can lead to enhanced productivity and
increased economic integration. In fact, no country in the industrial age has achieved high
income status without urbanization, and there exists a strong association between per
capita income and urbanization (Figure 1-6) and per capita income and export shares
(Figure 1-7). Well managed cities can “open the doors” to global markets in two ways: 1)
by creating productive environments which attract international investment and
increase economic efficiency; and 2) by creating livable environments which keep in
check rising urban costs that arise from increased densification.
FIGURE 1-6 URBANIZATION & DEVELOPMENT
SOURCE: AUTHORS’ CALCULATION BASED ON WDI DATA.
FIGURE 1-7 EXPORTS & DEVELOPMENT
History shows that the industrial development of modern economies almost always
begins in cities. The benefits of being around other people and other businesses are
typically labelled ‘agglomeration economies’ which is the starting point for
understanding how cities enhance productivity. The most basic agglomeration economy
is the reduction of transport costs for goods. If a supplier locates near customers, the costs
of shipping decline. In the early 1900s, New York and London were manufacturing
powerhouses, places where factories located to be close to customers and transport
infrastructure. And, in the late nineteenth century, four fifths of Chicago’s jobs were
compactly located within four miles of State and Maddison streets, close to where people
lived and infrastructure was located (Grover and Lall, 2015). Many of these benefits
increase with scale: towns and small cities cannot generate the same productive
advantages as larger cities. International evidence reveals that the elasticity of income
with respect to city population is between 3% and 8% (Rosenthal and Strange, 2004).
Each doubling of city size increases productivity by 5%.
Productivity gains are closely linked to urbanization through their ties to structural
transformation and industrialization. As countries urbanize, workers move from rural
areas to urban areas in search of higher paying and more productive jobs. Similarly,
entrepreneurs choose to locate their firms in cities where agglomeration economies
11
increase their productivity. Close spatial proximity has many benefits. Certain public
goods—like infrastructure and basic services—are cheaper to provide when populations
are large and densely packed together. Firms that are located near each other can share
suppliers which lower input costs. Thick labor markets reduce search costs as firms have
a larger pool of workers to choose from whenever they need to hire additional labor. And
spatial proximity makes it easier for workers to share information and learn from each
other. International evidence shows that knowledge spillovers play a key role in
determining the productivity of successful cities. In US cities, for example, a 10% rise in
the percentage of workers with a college degree leads to a 22% rise in per capita
metropolitan product (Glaeser, 2011).
Structure of the Urban Economy
Africa’s failure to industrialize is a cause for concern because much of the growth in
developing countries since the 1980s has been linked to the expansion of industrial
production and high-technology exports (Nallari et al, 2012). All else equal, countries are
better off when they export goods that rich countries export (Hausman, Hwang, and
Rodrik, 2006). Fast growing countries, like China, have switched from exporting mainly
resource and agro-based products to exporting high-technology products like optical
devices, transport equipment, and white goods. As noted by Nallari et al (2012): the big
gainers in China “were exports of electronic and telecommunications products and office
equipment, the shares of which grew from 5.4 percent in 1985 to more than one-third in
2006.” Other Southeast Asian countries experienced a very similar transition in their
export-mix during the last decade (Table 1-1). By contrast, the exports of Kenya—like
most other African countries—remain largely resource and agro-based (TABLE 1-2).
TABLE 1-1: TOP TEN COMMODITIES EXPORTED BY ASIA IN TERMS OF VALUE, 2000-2010
Commodity Trade value, billion USD
Electrical, electronic equipment 7412.3
Nuclear reactors, boilers, machinery, etc. 5049.8
Vehicles other than railway, tramway 2179.4
Mineral fuels, oils, distillation products, etc. 2059.4
Optical, photo, technical, medical, etc. apparatus 1088.0
Plastics 905.3
Articles of apparel, accessories, knit or crochet 800.7
Articles of apparel, accessories, not knit or crochet 782.6
Pearls, precious stones, metals, coins, etc. 773.0
Iron and steel 746.0
SOURCE: AUTHOR’S CALCULATIONS BASED ON UN COMTRADE DATABASE.
NOTE: ASIA INCLUDES EAST ASIA, SOUTH ASIA AND OCEANIA. MISSING VALUES IN THE ORIGINAL DATA WERE IMPUTED
THROUGH LINEAR INTERPOLATION AND CONSTRAINED TO BE NON-NEGATIVE.
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TABLE 1-2: TOP TEN COMMODITIES EXPORTED BY KENYA IN TERMS OF VALUE, 2000-2010
Commodity Trade value, million USD
Coffee, tea, mate and spices 8430.5
Live trees, plants, bulbs, roots, cut flowers, etc. 3470.9
Mineral fuels, oils, distillation products, etc. 3335.3
Edible vegetables and certain roots and tubers 2029.9
Salt, sulphur, earth, stone, plaster, lime and cement 1118.1
Vegetable, fruit, nut, etc. food preparations 961.3
Iron and steel 955.5
Tobacco and manufactured tobacco substitutes 913.3
Plastics 853.2
Articles of apparel, accessories, not knit or crochet 817.6
SOURCE: AUTHOR’S CALCULATIONS BASED ON UN COMTRADE DATABASE.
NOTE: MISSING VALUES IN THE ORIGINAL DATA WERE IMPUTED THROUGH LINEAR INTERPOLATION AND CONSTRAINED TO
BE NON-NEGATIVE.
References
Angel, S., J. Parent, D.L. Civco, and A. M. Biel. 2011. Making Room for a Planet of Cities.
Policy Focus Report, Lincoln Institute of Land Policy.
Demographia World Atlas (Built-Up Urban Areas or World Agglomerations). 2015. Ebook. 11th ed. Demographia. http://demographia.com/db-worldua.pdf
DigitalGlobe, CNES / Astrium, Data SIQ, NOAA, US NAVY, NGA, GEBCO, Google. 2016. Imagery and Map Data
Ellison, G. and E. Glaeser. 1999. The Geographic Concentration of Industry: Does Natural
Advantage Explain Agglomeration? American Economic Review 89, (2) (May
1999): 311-316.
Gollin, D. R. Jedwab, and D. Vollrath. 2015. “Urbanization with and without Industrialization,” Journal of Economic Growth, forthcoming.
Government of Kenya. 2009. Population and Housing Census, 2009.
Government of Kenya. 1999. Population and Housing Census, 1999.
Government of Kenya. 1989. Population and Housing Census, 1989.
Glaeser, Edward. 2011. Triumph of the City: How our Greatest Invention is Making us
Richer, Smarter, Greener, Healthier, and Happier (NY: Penguin Books).
Grover Goswami, A. and S. V. Lall. 2015. “Spatial Dispersion of Jobs in an African City:
Evidence from Kampala.” Unpublished paper, World Bank.
Hausmann, Ricardo., Hwang, Jason., and Rodrik Dani, 2007. "What you export matters,"
Journal of Economic Growth, Springer, vol. 12(1), pages 1-25
Medard, C. “City Planning in Nairobi: the Stakes, the People, the Sidetracking,” in Carton-
Bigot, H. and Rodriguez-Torres. D. (ed), Nairobi Today: the Paradox of a Fragmented
City. Nairobi: French Institute for Research in Africa.
Nallari, R. B. Griffith, and S. Yusuf. 2012. Geography of Growth: Spatial Economic and
Competitiveness. World Bank. Washington, DC.
13
Rahbaran, S. and M. Herz. 2014. Migration Shaping the City: Nairobi, Kenya. Zurich: Lars
Muller Publishers.
Rakodi, C. 1986. “Colonial Urban Policy and Planning in Northern Rhodesia and its
Legacy,” Third World Planning 8(3):193-217.
Rosenthal, S. and W. Strange. 2004. Evidence on the Nature and Sources of Agglomeration
Economies. In: Henderson, V, Thisse, F (Eds.), Handbook of Regional and Urban
Economics, vol. 4. (Amsterdam: North-Holland).
United Nations. Department of Economic and Social Affairs, Population Division (2016).
World Urbanization Prospects, the 2014 Revision (ST/ESA/SER.A/366).
Venables. A. 2015. “The Developing City: Urban Form and Function,” Unpublished paper,
University of Oxford.
United Nations United Nations Commodity Trade (UN Comtrade). 2015. Statistics Database. http://comtrade.un.org/db/.
United Nations, Department of Economic and Social Affairs, Population Division. 2015 World Population Prospects: The 2015 Revision, New York.
World Bank. 2009. World Development Report. World Bank, Washington, DC.
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Governance
The history of local governance in Kenya started during the colonial period. In 1902, a
law was passed which instituted local Chiefs (who were appointed by the colonial
administration) to manage villages. A decade later the Local Authority Ordinance
established a more formal, top-down system of decision making. The Colonial Governor
was given primary authority over the colony’s administration while the “Provincial
Commissioner (PC), the District Commissioner (DC), the District Officer (DO)” and tribal
chiefs were given lesser powers (Mboga, 2009, p.8). The administration of Nairobi was to
be carried out by a mixed Council with appointed officials who represented the interests
of both European and Asian residents. Africans, however, were not allowed to participate
in their own local governance until 1924 when local native councils were set-up across
the country. The responsibilities of these councils included raising local taxes and
providing basic services like “water, education, roads and bridges” (Muia, 2005). In 1950,
Local Native Councils and Settlers District Councils were respectively changed to African
District Councils and County Councils (Muia, 2005).
After Independence, a decentralized system of governance was introduced. There were
two tiers of government: the national government and seven autonomous regions.
“Political representative at the regional level was through Regional Assemblies. At the
national level, representation was through the Senate, which also took care of the
interests of regional governments” (Onyango, 2013, p. 2). Regional Assemblies could levy
taxes and were responsible for providing a variety of local services including primary
education, housing, and health services.
The authority of these assemblies, however, was gradually reduced after the election of
Jomo Kenyatta who ruled Kenya from 1963 to 1978. Under Kenyatta’s rule, two
amendments were introduced to the Constitution. “The first amendment made Kenya a
republic…and reduced the powers of regional governments over taxation, local
authorities, and functions that were shared with national (concurrent) government such
as agriculture, education, and housing. The second replaced the regions with Provinces
and abolished the Senate” (Onyango, 2013, pp. 2-3). By 1970 all mention of devolution
and a system of local government had been removed from the Constitution, essentially
transforming Kenya into a unitary state.
From 1977 onwards, however, there has been a gradual shift back toward
decentralization. In 1977, the government passed the Local Government Act (Cap 265)
which re-established local authorities. Despite this change in political structure, the
government’s decision making process remained highly centralized. For example, the
Minister of Local Government (who was appointed by the President) was responsible for
the administration, budget, and oversight of all local authorities. In addition, one-third of
the councillors in each local authority were appointed by the Minister of Local
Government while the other two-thirds were elected. This system of governance
continued through the 1980s.
Since the early 1990s, Kenya has initiated a wide range of reforms as part of its local
government reform programme (see Table 2-1) which was established and funded by the
15
World Bank. Central to this effort has been the adoption of a new Constitution in 2010.
Sections 8 through 11 of the Constitution outline both the structure and functions of
Kenya’s new, decentralized system. The current structure is a two-tier system consisting
of a national government and 47 semi-autonomous, county governments. According to
the Constitution, these two levels of government are equal in status but should “support,
respect, and work in harmony” with each other.
The Ministry of Justice, National Cohesion, and Constitutional Affairs has an important
mandate in the implementation of the Constitution. It facilitates various governance and
institutional reforms including the operationalization of the Interim Independent
Electoral Commission (IIEC) and its successor commission the Independent Electoral and
Boundaries Commission (IEBC), the Interim Independent Boundaries Review
Commission (IIBRC), the Truth Justice and Reconciliation Commission (TJRC), the
National Cohesion and Integration Commission (NCIC) and the Interim Independent
Constitutional Dispute Resolution Court (IICDRC). The Ministry was also tasked with
promoting citizen participation in the implementation of the governance process.
Table 2-1: Main Constitutional, Law or Regulation Changes related to Local
Authorities
Legislations Provisions
(1963) Local Government regulations - Established municipal, county, urban and local
councils.
- Defined the scope of functions for local
governments: primary education, health, road
maintenance, water and sanitation, public housing
and land administration.
(1964) - Change in legislation making regions dependent on
the central government’s grants.
(1966) - Abolition of the Regional Chamber and the Senate
(1969) Transfer of Functions Act - Abolition of the Provincial Councils; repeals all past
laws of the regional assemblies; and deletes from the
Constitution all references to devolution, local
authorities and federalism.
(1977) Local Government Act (Cap 265 of the Laws
of Kenya)
- Nairobi becomes City Council and managed under
the municipal status.
- Established local authorities and defines their
powers and functions.
- Establishment of rules for budgeting: >15% of the
National Budget should be given to Local Authorities
on an equal basis.
- Establishment of the Equalization Fund,
established. This Fund is strictly for special groups
16
and regions that over time were left out in terms of
development
(2010) Constitution of Kenya 2010 - Establishment of a two level state, national and
local.
- The legislative power is divided between a
bicameral parliament (with the National Assembly
and a Senate representing local authorities) and
County Legislative assemblies
- The executive power is divided between National
executive and executive structures in the county
governments (County Executive Committee)
- Both level also have an independent judiciary
power.
(2011) Urban Areas and Cities Act Definition of different type of urban areas and their
governance bodies
(2012) The County Governments Act
- Main devolution law.
- Regulation of national and local governments and
assemblies defined by the new Constitution
- Creation of counties, sub-counties and
constituencies
(2012) The Transition to Devolved Government Act
- Establishment of the Transitional Authority as the
body responsible for the transition
(2012) The Intergovernmental Relations Act - Co-ordinate the transition to the devolved system
of government
- Provision of rules and process governing the relation
between the new bodies
(2012) Public Finance Management Act - Definition of the rules and regulations for budgeting
provided in the Constitution
The Constitution outlines the structure of government in the new, two-tier system. At the
national level, there are three branches of government: the Executive, the Parliament, and
the Judiciary (see Figure 2-1). The Executive is comprised of the President, the Deputy
President, and the Cabinet who are responsible for national policy formation and its
implementation across all sectors (Chapter Nine, Article 129 of the Constitution). The
Parliament is a bicameral legislature with two houses: the National Assembly and the
Senate. The National Assembly is comprised of 349 members (240 elected, 47 women
representatives elected from the counties, and 12 nominated) while the Senate is
comprised of 67 members (47 elected members from each county, 16 women nominated
from political parties, and four individuals who represent the interests of the young and
17
persons with disabilities). Elections are held every five years. Finally, the Judiciary is
headed by a Chief Justice and is divided into Superior Courts and Sub-ordinate Courts.
FIGURE 2-1: KENYA DEVOLVED SYSTEM
In addition, there are three branches of government at the County level: the Executive;
the Legislature, and the Judiciary (see Figure 2-2). The Executive arm of the government
consists of the County Governor and the County Executive Committee which is “made up of
people appointed by the Governor and approved by the County Assembly” (Onyango, 2013, p.
13). The legislature arm is formed by the County Assemblies. Members of the assemblies
are elected by registered voters in each ward. Finally, the judicial arm handles court cases
at the local level.
The Constitution places the responsibility of urban governance under the jurisdiction of
county governments. However, the autonomy of these governments is limited. Article
184 stipulates that the governance and management of urban areas should be set by
national legislation. The structure of urban government is outlined in Article 176. Each
county should have a county government which consists of a county assembly and a
county executive. The county assembly consists of members who are elected by the
registered voters of wards. Each ward constitutes a single member’s constituency.
Kenya unitary State
National Government
Legislative Power
National Assembly
Senate
Executive Power
President &
Deputy Pres.
Cabinet
Judiaciary
Local Government
County Assembly
County Executive
Judiaciary
18
FIGURE 2-2: LOCAL GOVERNANCE MAP
SOURCE: ONYANGO, 2013, P.12
In the new decentralized system, there are three classes of urban local authorities: city
counties, municipalities and towns (Urban Areas and Cities Act, 2011). City counties are
defined as urban areas with a population of at least 500,000 residents. Currently, only
Nairobi, Mombasa and Kisumu have attained City County status. Municipalities are
defined as urban areas with more than 250,000 but less than 500,000 residents
Municipalities have more than 10,000 but less than 250,000 residents.
2.1. Governance in Nairobi
Before 2010, the City Council of Nairobi was the local authority which governed the city.
It was under direction of the Ministry of Local Government whose responsibilities
included appointing the Town Clerk who was the chief executive of the city council. The
city’s Executive branch was divided into 17 main and 4 sub-committees. Any new
proposal had to be approved by consensus in each committee, then passed through
review in the Council, before it could be finally approved by the Ministry for local
Government (Nairobi City Council, 2015). In addition, Nairobi County Council had a non-
executive branch headed by the Mayor.
Currently, Nairobi is governed by the Nairobi City Council which is the successor of the
now defunct City Council of Nairobi. The services provided by City Council include:
“Physical Planning, Public Health, Social Services and Housing, Primary Education
Infrastructure, Inspectorate Services, Public Works, Environment Management. The new
devolved services include “Agriculture, Livestock Development and Fisheries, Trade,
Industrialization, Corporate Development, Tourism and Wildlife, Public Service
Management” (Nairobi City Council, 2015).
However, many of these public services, particularly the development of infrastructure,
are also under the responsibility of parastatal companies such the Kenya Urban Roads
19
Authority, Nairobi Water and Sanitation Company, and Kenya Power for electricity. As a
result, the Nairobi City Council must coordinate with national planners and the
parastatals when planning any new development in the city. According to a recent Dfid
report (2015), this set-up reduces the incentive for the city to raise finance for its own
urban infrastructure investment.
2.3 Urban Finance
The Constitution of Kenya 2010 gives the county government oversight powers over
urban areas and cities. Article 209 empowers the counties to impose taxes and levy user
charges. Article 212 provides for county borrowing with the guarantee of the national
government. National legislation provides the framework for borrowing by the county
governments.
The principle of public finance is underscored in Article 201 of the Constitution that
provides for equitable sharing of national revenues between national and county
governments. In this regard, counties are mandated to provide adequate resources to the
urban areas under them, drawing on the budgetary allocations from the national
government under Article 203 of the Constitution.
In the past, many urban authorities were created without adequate consideration of the supporting resource base. For this reason, most of these authorities have been dependent, for their survival, on the Local Authorities Transfer Fund (LATF), barely providing services to residents as expected (Nairobi City Council, 2014).
2.4 County Government Autonomy in Decision Making
As stipulated in the County Government Act 2012, no public funds shall be appropriated
outside a planning framework developed by the county executive committee and
approved by the county assembly. This means that the county government must have a
master plan to receive funds from the national government for project implementation.
While the national government can support local decisions on where and how to invest their resources, it must not initiate local, county-level decisions. Still, the national government is involved in country-level investment projects. For example, if a county government were to propose the construction of a ring-road, it would have to complete a number of steps (involving both tiers of government) before construction could begin. The following steps would have to be taken. First, a technical study would have to be prepared in order to determine project viability. This study would be presented to the county technical committee for approval. On approval, the project would then be tabled in the County Assembly as it would to apply for financing for the project from national government. In most cases, such a project would be contained within the County Integrated Development Plan (and therefore immediately passed onto the national government for financing). Construction of the road would then be undertaken by the
20
appropriate road agency/authority (Adolwa, P., Urban Development Department, Ministry of Lands, personal communication, December 2015).
2.5 Revenue Sources
Article 209 of the Constitution 2010 considers property tax to be the key pillar of the
urban revenue base. This tax, however, is difficult to collect as many properties are not
registered in the city. County governments therefore resort to other forms of taxation.
For example, user charges are levied on consumers who use specific services or facilities.
Such user charges take the form of “pay-as-you-use” taxes. Such taxes are the tool of
choice used by county governments when they want to ration a scarce public good.
Examples of such taxes include utility fees (water and power) as well as charges for
parking and open air markets.
In addition, local revenue has been generated from permits to exploit a wide range of
natural resources. The fees charged are known as royalties. The bulk of the revenue
raised from royalties has been collected by the national government and only a modest
proportion has gone to urban areas and cities.
Finally, Article 204 of the Constitution establishes the Equalization Fund under the
management of the national government to provide basic services to marginalized areas
or committees to ensure parity in development. Wherever applicable, this fund is used to
address the disparities in service provision in urban areas in different parts of the
country.
2.6 Revenue Allocation
In accordance with Article 203 (2) of the Constitution, at least 15% of the national
revenues are to be allocated to county governments to finance their operations.
Allocation of funds is straightforward for counties that are entirely urban, such as Nairobi
and Mombasa. However, for counties that have both urban and rural communities, there
is a need to provide a clear mechanism that will allocate adequate funds to urban areas
(KNBS, 2014).
Fiscal decentralisation is a key aim of devolution. Both the Constitution and the County
Allocation of Revenue Act, 2013 provide for the reallocation of national revenue to county
governments. The allocation of revenue is based on a pre-determined formula. This
formula ensures equitable distribution of resources through a number of parameters
namely; population (45 per cent), poverty index (20 per cent), land mass (8 per cent),
basic equal share (25 per cent) and fiscal responsibility (2 per cent); (ibid).
A total of KSh 190.0 billion was allocated to the county governments equitably in 2013/14. The Nairobi City County received the highest allocation of KSh 9.5 billion while
21
Lamu County received the least at KSh 1.5 billion. In addition to the equitable share allocation, county governments were allocated a total KSh 20.0 billion conditional grant for a targeted use, project or beneficiary. Counties are expected to generate a total of KSh 67.8 billion which is 24.4 per cent of the total revenue. In addition county governments were allocated KSh 3.0 billion under the Equalization Fund (KNBS, 2014).
2.7 Mobilizing Capital: Public Private Partnership and Borrowing
Major infrastructure development in cities require substantial capital expenditure. For
this reason, public revenues from taxes, user fees, and intergovernmental transfers are
unlikely to be sufficient to meet the infrastructural needs of urban areas. The alternative
is to complement these sources with private capital, a strategy that has not been
exhaustively explored as of 2012. Private sector risks in financing municipal
infrastructure include the lack of transparent municipal accounting systems, inadequate
collateral, and project revenue streams that rarely match commercial debt costs (ibid).
The Ministry of Finance issued Public Private Partnership (PPP) Regulations in February
2009, in accordance with section 64(4) of the Public Procurement and Disposal Act 2005.
These regulations provide the legal framework for the implementation of PPPs by public
entities. These can be adapted by county governments to mobilize private capital to
finance infrastructure and thus alleviate the funding constraints faced by the public
sector (ibid).
The Constitution of Kenya under Article 212 provides that a county government may
borrow only if the national government guarantees the loan and if the county government
assembly gives approval. As of 2014, county governments were seeking the right to apply
for foreign financial support. The national government, however, has displayed caution
towards allowing any direct contact between county governments and foreign funding
actors as its ability to regulate and monitor such partnerships effectively could prove
difficult (ibid)
As of 2012, urban authorities were not servicing their loans satisfactorily which forced
the national government to assume these liabilities by default, thus contributing to the
overall indebtedness of the country. As urban authorities were generally insolvent, they
have found it difficult to borrow from the capital market. In the past there had been a
tendency for urban authorities to rely on externally generated funds to finance capital
development projects. This has generally slowed project implementation because loan
terms and conditions have by and large been restrictive. Additionally, the flow of grants
from bilateral partners is neither predictable nor sustainable (Adolwa, P., Urban
Development Department, Ministry of Lands, personal communication, December 2015).
22
References
DFid., 2015. Urban infrastructure in Sub-Saharan Africa – harnessing land values, housing
and transport: UK: London.
Kenya National Bureau of Statistics. 2014. Economic Survey 2014.
Government of Kenya. 2012. Ministry of Justice, National Cohesion and Constitutional
Affairs. Understanding the Constitution of Kenya, May 2012, Kenya National
Integrated Civic Education Programme (K-NICE).
Government of Kenya. 2013. Kenya Vision 2030 Progress Report. Nairobi, Kenya.
Muia, M. 2005. in Mboga, H. (ed) Understanding the Local Government System Citizen
Handbook: Institute of Economic Affairs.
Nairobi City Council. 2015. Retrieved from http://www.nairobi.go.ke/
Nairobi City Council. 2014. Integrated Urban Development Master Plan for the City of
Nairobi in the Republic of Kenya, Final Report (Draft).
Ngau, P. 2013. For Town and Country, a New Approach to Urban Planning in Kenya: Africa
Research Institute.
Onyango. P. 2013. Devolution Made Simple: Friedrich-Ebert-StiftungNelly Kamunde-
Aquino (2014) Kenya’s Constitutional History: REDD+ Law Project - Briefing Paper
23
Land and Housing Markets
Land and housing present important challenges that Kenya must face as its population
continues to grow and move into urban areas. In this chapter, we present a brief historical
account of the evolution of land tenure institutions in Kenya. In addition, we highlight
important features of Kenya’s current land legislation and discuss some of the most
significant challenges for the land and housing sectors.
3.1. The Evolution of Land Tenure in Kenya
Pre-colonialism
Land tenure practices in pre-colonial Kenya varied across different communities,
influenced by factors such as population density, climate and agricultural conditions
(Migot-Adholla, Place, & Oluoch-Kosura, 1994). In spite of this heterogeneity, some
patterns were common to the different groups. An important characteristic of tenure
practices at this time was that access to land was based on kinship (Kanyinga, 2000), with
land rights remaining inheritable within families (Migot-Adholla et al., 1994).
The availability of land was an important factor in determining land tenure patterns. In
places where land was abundant, the youngest son would inherit the father’s plots while
older siblings would establish new farms in unoccupied land. This practice changed as
population grew and unoccupied farm land and pasture became scarce, and inheritance
became the main mechanism for the transfer of property rights (Migot-Adholla et al.,
1994).
The Colonial Period
The colonial period saw the emergence of a system of dual tenure in which settlers and
private corporations were granted freehold titles or leaseholds (in accordance with the
Land Titles Act of 1908) while property rights continued to be governed according to
customary tenure in most areas occupied by natives (Migot-Adholla et al., 1994).
While the government was initially opposed to the extension of private tenure in
replacement of customary tenure, this changed in the years that preceded independence.
After the investigation of the East African Royal Commission, which saw indigenous
tenure as a constraint to “the development of a modern economy” (East Africa Royal
Commission, 1953–1955, Report, 1955, p. 397), the British authorities began with the
Swynnerton plan (1954) a process of individualisation and registration of land titles that
extended to land previously under customary tenure. This process would continue after
Kenya achieved independence in 1963.
Post-independence
After independence, Kenya maintained much of the legal framework that had governed
the administration of land in the colonial period, with some of the powers that had been
24
given to the governor now being in the president’s hands (Kanyinga, 2000). In particular,
all powers regarding the leasing, granting and disposition of government land or former
crown lands were under the president (Government Lands Act, Cap. 280), and the state
was treated as the ‘main landlord’ (Kanyinga, 2000; Karuti, Lumumba, & Amanor, 2008).
New laws were also enacted. The Registered Land Act of 1963 allowed for absolute
ownership of land, which generated disputes and increased insecurity of tenure for those
who did not formally own land (Kanyinga, 2000). The Land Control Act of 1967
established land control boards whose approval was needed for most transactions
involving agricultural land. It was enacted in order to prevent landlessness through
unregulated land sales and to control the acquisition of land by foreigners (Kanyinga,
2000). The Land Adjudication Act of 1968 complemented the Land Consolidation Act of
1958, applying to areas where consolidation of land was politically difficult and allowing
for registration and issuance of separate titles to fragments owned by one individual
(Kanyinga, 2000). In later years, the Land Disputes Tribunals Act of 1990 limited the
jurisdiction of magistrates’ courts, establishing instead district Land Disputes Tribunals
that were to rule cases related to boundaries, claims to occupation and trespass; this act
has since been repealed.
XXI Century
The strategy towards increased individualisation of rights to land along the Western
model and the relinquishing of customary tenure, motivated by the conviction that this
was essential for economic growth, faced some opposition within Kenya (Bruce, 2008). A
prominent criticism was that individualisation resulted in most land being registered in
the name of men, thereby taking rights to land away from women, who are often the main
users of the land; a second problem was that the shift towards formal land legislation
rather than customary law was not fully completed, which led to conflicts between
customary and statutory law and increased tenure insecurity (Bruce, 2008).
These and other concerns regarding the existing legal framework led to a call for a
consistent national land policy which would address these challenges. In 2004, a concept
paper issued by the Ministry of Lands and Settlement identified the major problems to be
addressed by such a policy (such as insecure land tenure and poor land administration)
and set the main objectives and principles that should guide it (Ministry of Lands and
Settlement, 2004). In December 2009, Parliament adopted a new National Land Policy.
The new policy recognises that previous legislation ignored customary land rights and
“traditional resource management institutions” and states that the Government shall
“document and map existing forms of communal tenure” (Republic of Kenya, 2009, p. 15).
It also provides for the restoration of land rights to “those that have unjustly been
deprived of such rights” (p. 41), thus seeking to redress “historical injustices” brought
about by the process of individualisation.
The implementation of the National Land Policy was followed by the adoption of a new
constitution in August 2010. The constitution specifies a set of principles according to
which land is to be used and managed—which include the elimination of gender
discrimination and an encouragement for disputes to be settled through local community
25
initiatives—and calls for these principles to be implemented through a national land
policy.
The new constitution has also changed the organisation of local government. In
particular, under the constitution the former city local authority of Nairobi became one
of a total of 47 counties in the country below the national government in a two-tier
system. The role of the national government in land use planning and development is
limited to providing policy direction to the counties, which are the implementing
authorities (Department for International Development, 2015).
More recently, in 2012 the Land Act was enacted which contains important provisions
related to the administration of land. This act guides the management and administration
of public land, provides for different forms of land tenure (freehold, leasehold, customary
land rights and others, which include easements), contains provisions on contracts and
transfers of private land and allows for the compulsory acquisition of land by the state
subject to prompt compensation of the owner.
Table 3-1 summarises some of the main laws and policies relating to land that were
enacted in Kenya since 1963.
TABLE 3-1: SUMMARY OF SELECTED LAWS AND POLICIES SINCE 1963 Law or policy Date Description
Registered Land Act (Cap. 300) 1963 Gave absolute and indefeasible title to the
registered land owner
Superseded former acts, requiring re-registering
of property
Land Control Act (Cap. 302) 1967 Provided for the establishment of land control
boards whose approval was necessary for most
transactions affecting agricultural land
Land Adjudication Act (Cap. 284) 1968 Complemented the Land Consolidation Act (Cap.
283): applied in areas where consolidation was
difficult
Allowed for registration and issuance of separate
titles to fragments held by a single individual
Land Disputes Tribunals Act (Cap.
303A)
1990 Limited the jurisdiction of magistrates’ courts
Established district Land Disputes Tribunals
which had jurisdiction over cases related to
boundaries, claims to occupation and trespass
National Land Policy 2009 Classifies land as public, community and private
Provides for equal recognition of land rights under
all tenure systems
Provides for the restoration of land rights to those
deprived of land by the process of
individualisation
26
Recognises the need for land use plans at the
national, regional and local levels
Constitution 2010 Specifies principles for the use of land which
include:
o Elimination of gender discrimination
o Encouragement of local community
mechanisms for dispute resolution
Reiterates the National Land Policy’s classification
of land as public, community and private
Provides for the establishment of a National Land
Commission which is responsible for managing
public land and recommending a national land
policy to the government
Land Act 2012 Guides the management and administration of
public land
Provides for different forms of land tenure:
freehold, leasehold, customary land rights and
others
Contains provisions on contracts and transfers of
private land
Allows for compulsory acquisition of land by the
state subject to compensation
SOURCES: FAOLEX; KANYINGA (2000); ORIGINAL LEGAL TEXTS.
3.2. Overview of Current Legislation and Procedures
Classification of Land
The constitution of Kenya classifies land as public, community or private. Public land
includes, among other categories, land occupied by any state organ, land for which no
individual or community ownership can be established and any land which is not private
or community land. Community land is to be held by communities as defined by ethnicity,
culture or other common interest. Finally, private land is held by any person under
freehold or leasehold tenure or else declared private by the Parliament.
While some of the laws governing tenure differ for the three types of land, a few major
land acts contain provisions which apply to each of the different categories. In particular,
the Land Act, the Land Registration Act and the National Land Commission Act, all
enacted in 2012, extend to the three types of land.
Acquisition of Private Land
According to the World Bank Doing Business 2016 report, transferring property in Kenya
requires nine procedures that take 61 days to complete and cost 4.2% of the property
27
value (World Bank, 2015).1 Doshi et al. (2014) describe the process: it generally begins
with the interested buyer searching the Register and obtaining a certificate verifying the
owner of the land. This is followed by the payment of a deposit by the purchaser (usually
10% of the purchase price). The sale agreement is then signed, which provides for a
completion period (normally 90 days) during which payment is made and the title is
registered in the name of the purchaser. The buyer must pay a stamp duty on the
transaction (4% of the purchase price in municipalities and towns and 2% in rural areas)
and, before the transfer is registered, a government official must perform a valuation to
confirm that sufficient duty was paid. It is only after this valuation that the transfer is
registered and the new title issued.
Resolution of Disputes
Land disputes in Kenya are often first addressed through community dispute resolution
mechanisms and, if the parties are not satisfied with the outcome of these mechanisms,
they may take them to the formal court system. Informal dispute resolution is especially
important in rural villages where formal institutions may be difficult to access
(Harrington & Chopra, 2010; Nobirabo, 2013).
The use of alternative or traditional dispute resolution mechanisms is encouraged in the
2010 constitution as well as by the National Land Policy and major land laws. One
shortcoming of traditional dispute resolution mechanisms is that they may be biased
against women (Harrington & Chopra, 2010). A second issue is that community elders,
who are generally those responsible for resolving disputes at the local level, are reported
to no longer have the authority they once had (Harrington & Chopra, 2010; Nobirabo,
2013).
3.3. Challenges Facing Kenya’s Land and Housing Sectors
Despite the recent adoption of new laws and policies in Kenya which recognised and
sought to address some of the problems related to land, many challenges still remain.
1 These numbers assume that the land in question has a value of 50 times income per capita and is free of title disputes. Other assumptions are specified in the report (p. 45).
28
Lack of Supply
A first issue is the lack of sufficient formal housing supply. Kenya’s population is growing
fast—at a rate of 2.6% in 20142—and a significant share of this population is living in
urban agglomerations. In 2014, 25% of Kenya’s 44.9 million citizens were living in urban
areas and this proportion is estimated to increase to 43.9% by 2050.3 Figure 3-1 shows
the actual and estimated shares of Kenya’s population living in urban areas from 1950 to
2050.
This fast increase in total population and urban population in particular (which grew at
a rate of 4.3% in 20144) creates a significant need for housing. In 2010, the World Bank
estimated a housing requirement of 206.000 units. Construction of formal housing,
however, failed to match this demand: the Ministry of Housing estimated construction at
50.000 units per year, creating a yearly housing deficit of 156.000 units. To this annual
deficit one must add a pre-existing shortage of approximately 2 million houses (World
Bank, 2011). As urban population continues to increase, these numbers are only likely to
worsen.
An important consequence of this lack of supply of formal housing is the prevalence of
large slums in urban areas which host a large share of the urban population (Arvanitis,
2013). In Nairobi, according to the 2009 National Census, 33.7% of a population of 3.1
million live in slums (UN-HABITAT, 2010). According to the Department for International
Development (DFID), 70% of the city’s housing stock is comprised of shacks built with
mud, wood and galvanised sheets; the majority of these shacks are rented (Department
for International Development, 2015).
2 World Development Indicators. 3 World Urbanization Prospects 2014. 4 World Development Indicators.
0
5.0
10.0
15.0
20.0
25.0
30.0
35.0
40.0
45.0
50.0
19
50
19
55
19
60
19
65
19
70
19
75
19
80
19
85
19
90
19
95
20
00
20
05
20
10
20
15
20
20
20
25
20
30
20
35
20
40
20
45
20
50
Per
cen
tage
of
po
pu
lati
on
FIGURE 3-1: PERCENTAGE OF POPULATION AT MID-YEAR RESIDING IN URBAN
AREAS IN KENYA, 1950-2050 SOURCE: WORLD URBANIZATION PROSPECTS 2014.
29
High Housing Prices and Limited Access to Finance
A closely related issue to the shortage of housing supply in Kenya’s urban areas is the lack
of affordable housing, especially for low income groups.
Despite high growth rates in recent years, poverty remains a significant problem in
Kenya. The World Bank estimated that, in 2005, 45.9% of the country’s population lived
below the national poverty line;5 other figures for poverty rates in the country are also
greater than 40% (e.g., UNICEF; World Bank, 2011). Poverty is not an exclusively rural
issue. As mentioned above, approximately one third of Nairobi’s population lives in
slums. 73% of these were estimated to fall below a poverty line of USD 42 per month,
excluding rent, while at least 26% were unemployed (World Bank, 2006).
The prevalence of poverty in Kenya in general and in Nairobi in particular is an important
factor in explaining why a significant proportion of the urban population cannot afford
formal housing and is forced to live in slums. However, the problem extends beyond the
very poor to the middle income classes as well.
According to the Centre for Housing Finance in Africa, a two-bedroom house in Nairobi
costs approximately USD 33,500. The Centre reports that the National Housing
Corporation, a state-owned corporation which plays a role in implementing the
government’s housing policy, provides three-bedroom apartments for USD 58,000 in the
periphery of the city and claims that these are 30% below the market price.
Property values and housing prices in the city have increased in recent years, probably
and in part as a reflection of the shortage of supply. HassConsult, a real estate agency that
publishes regular reports on the Kenyan and Nairobi property markets, states that in
Nairobi’s 18 most active suburbs land prices have increased 5.59-fold since December
2007 (HassConsult, 2015a); the value of housing properties in the whole of Kenya has
increased 3.72-fold since 2000 (HassConsult, 2015b). According to DFID, in the past five
years the value of land along major infrastructure corridors has more than doubled and
in the city as a whole property prices have increased at an average rate of 25% per year
(Department for International Development, 2015).
These prices are beyond the reach of the great majority of Nairobi’s population, a problem
which is exacerbated by limited access to mortgage finance as well as by a very limited
supply of houses at the lower end of the market (World Bank, 2011).
According to the Central Bank of Kenya, 36 financial institutions currently offer mortgage
loans to customers; the average interest rate in 2014 was 15.8% (Central Bank of Kenya,
2014) while inflation stood at 6.9%.6 In spite of this apparently large number of
institutions providing mortgages, the World Bank estimated in 2011 (based on data from
2005/06 as well as more recent GDP data) that only 2.4% of Kenya’s total population and
11% of the country’s urban population earns enough to support a mortgage for a basic
house (the price of the house considered for these computations was KES 3.2 million,
which equals approximately USD 31,000 at current rates; the World Bank further reports
5 World Development Indicators. 6 World Development Indicators.
30
that the minimum value for a mortgageable property is KES 4 million) (World Bank,
2011). The Centre for Housing Finance undertook a similar exercise and concluded that
a monthly payment of at least USD 1,094 would be required to support the average loan
size of USD 77,000 over 20 years (Centre for Affordable Housing Finance in Africa, 2014).
Considering that 80% of the country’s urban population earns less than USD 7,911 per
year (World Bank, 2011), this is makes the average mortgage very much out of reach for
the average citizen.
The difficulty that the great majority of Kenyans face in accessing mortgages is reflected
in the very small size of the market. In December 2014, there were 22,013 mortgage loans
outstanding at a total value of KES 164 billion (approximately USD 1.6 billion at current
rates) (Central Bank of Kenya, 2014), which indicates that less than 0.1% of Kenya’s
population has a mortgage. In a survey conducted by the Central Bank of Kenya in 2014,
the high cost of housing was the most mentioned factor by banks as an impediment for
the growth of their mortgage portfolio; this was followed by high interest rates, while the
low level of income was the fourth most cited cause.
A recent development in housing for the low and middle income groups in Nairobi
highlighted by DFID is the increasing importance of ‘tenement’ housing. This generally
consists of residential buildings of six to eight stories that are rented to individual
tenants. Construction tends to be informal and quality is often low. In certain areas of the
city, the pressure for densification has led to the appearance of districts marked by these
high-rise buildings. The local government estimated in 2009 that over 10,000 tenement
buildings existed in Nairobi (Department for International Development, 2015).
Complex Bureaucracy and Corruption
A third challenge is the bureaucracy associated with land administration in Kenya. This
can be seen in, for example, the time required to register property. As mentioned above,
the World Bank reported in 2015 that registering property in Kenya requires 61 days.
This marks a positive improvement from 2004 and the ten following years when this
process took 72 days. However, it remains above the Sub-Saharan average of 57.5 days
and is very distant from the average of 21.8 days for high-income OECD countries.7 Figure
3-2 shows the number of days necessary for registering property in Kenya, its
neighbouring countries,8 South-Africa and high-income OECD countries.
7 World Bank Doing Business database. 8 No data is available for Somalia.
0
10
20
30
40
50
60
70
High-incomeOECD
South Africa Uganda South Sudan Kenya Tanzania
Tim
e in
day
s
FIGURE 3-2: TIME NECESSARY TO REGISTER PROPERTY IN SELECTED AFRICAN
COUNTRIES AND HIGH-INCOME OECD AVERAGE SOURCE: WORLD BANK DOING BUSINESS 2016.
31
The complexity of bureaucracy may be linked to the poor organisation of the country’s
land registries. Reporting in 2014 on its Kenya Transition Initiative, which sought to
promote political and social stability following the violence in the wake of the 2007
elections and which, among other things, worked to improve Kenya’s land records, USAID
comments that “in many of Kenya’s land registries, decades of paper files were piled on
top of each other, leaving them vulnerable to accidental damage and loss as well as
intentional manipulation, theft and destruction” (USAID, 2014).
Corruption is a common problem in Kenya’s land administration. Land services rank
second in Transparency International’s (TI) aggregate corruption index for the country,
with the police occupying the first position. The results from a recent survey indicate that,
when dealing with land services in 2014, respondents had a 17.5% probability of being
asked for a bribe, which is a marked increase from 8% in 2013. The average size of bribes
was KES 7,219 (approximately USD 70 at current rates). TI claims that supposedly
missing files have long been used by those working in these services as an excuse for
demanding bribes (Transparency International, 2014). These conclusions are supported
by different research conducted by the Land Development and Governance Institute
(LDGI) which reports that 41% of respondents in a survey perceive corruption as being
high or very high in the administration of land (Land Development & Governance
Institute, 2015).
Despite these problems, Kenya has taken steps towards a more efficient and effective
system which is less prone to corruption. According to the World Bank, since 2011 Kenya
has made property transfers faster through improved electronic document management
(World Bank, 2015). Moreover, the government has recently introduced an online search
platform (eCitizen9) for the country’s land records. An important challenge is now to
encourage the population to make use of this platform: in the survey mentioned above,
LDGI found that only 37% of respondents were aware of the new platform.
Insecurity of Tenure
A further challenge for Kenya’s land and housing development is the lack of tenure
security which affects a significant share of the population. This problem stems from an
historical context in which many people did not have formal rights to the land they
occupied and is exacerbated by the difficulty that many Kenyans still face in acquiring
legal access to land and housing.
Insecure tenure is a problem in both rural and urban areas and is particularly severe in
informal urban settlements. As mentioned above, it is estimated that over one million
people live in Nairobi’s slums. Most slum dwellers live in rented houses: Gulyani and
Talukdar (2008) find that 92% of a sample of 1,755 households living in slums in Nairobi
rent; this is in line with numbers for the city as a whole where 90% of people rent.10 This
makes them vulnerable firstly to arbitrary rent increases (Amnesty International, 2009).
Moreover, in occupying private or public land, which may sometimes be reserved for
9 The eCitizen platform can be accessed at https://lands.ecitizen.go.ke. 10 Kenya State of the Cities Baseline Survey 2013.
32
public projects such as roads or electricity lines (Amnesty International, 2009), slum
inhabitants are under constant threat of eviction.
Forced evictions are indeed very common in Nairobi’s slums. They often take place
without prior notice being given to the occupants, who are not consulted or given the
opportunity to object to their forced relocation and may not even be granted the time to
remove their belongings from their houses. Evictions will sometimes be carried out
during the night by heavy machinery backed by local police and may also be imposed
through arson.
Amnesty International (2009) describes an eviction which took place in the Deep Sea
settlement, a slum formed in 1963 and which in 2009 was estimated to house
approximately 7.000 people. In September 2005, after a private company claimed
ownership of the land and obtained a court order for eviction, the homes of 850 families
were destroyed by government-owned bulldozers during the night. In the period of 2005
to 2006 alone, the Centre on Housing Rights & Evictions registered seven major evictions
in Nairobi (Centre on Housing Rights and Evictions, 2006). More recently, a road
expansion development led to an eviction in the settlement of Jomvu in May 2015 while
more than 300 homes were destroyed in Mathare in August (Amnesty International,
2015a, 2015b).
Tenure insecurity and evictions are also used for political purposes. According to Omenya
and Lubaale (2012), political candidates may displace communities who do not support
them or, on the contrary, take possession of land illegally and resettle supporters there.
Politicians also use squatters to protect public land that was illegally allocated.
Insecure tenure is a relevant factor behind the lack of quality housing in Kenya. Since
many people do not have a formal title granting them a right to the land they occupy, the
threat of having someone else claim a right to their land reduces their incentives to invest
in their property, contributing to the proliferation of temporary, low-quality housing.
Amnesty International (2009, p.13) quotes a resident of Kibera, Nairobi’s largest slum,
explaining the lack of incentives brought about by insecure tenure:
“If there was private land, you have a right, and the government has a title deed.
Because there is conflicting origin, and we don't know the owner of the land, so there
is a temporary element, you don't invest. Because maybe one day, you rise up, and
someone has destroyed your house, claiming it is his or hers, and he is claiming that
they want to build here.”
An important factor which contributes to the common occurrence of forced evictions is
the lack of an adequate legal framework to govern the issue. While the 2010 constitution
does protect the right to property under a broad definition, there is no law dealing
specifically with evictions. An Evictions and Resettlement Procedures Bill was drafted in
2012 but has not yet been approved by the Parliament.
Lack of Adequate Infrastructure
Finally, a significant problem affecting quality of living in Nairobi is the lack of adequate
urban infrastructure. According to DFID, although services such as piped water,
sanitation and electricity are in place, they are not reliable and are not available to all of
33
the city’s population. For example, the current supply of water can only satisfy 70% of
the demand. The Northern Collector Tunnel, a major project that may address the current
lack of supply, has not yet been completed in spite of being initially planned for 1998. Not
only is supply insufficient, the water connection system in the city is also inadequate:
while some areas of the city are almost always supplied with water, others may have
access only once a week. Only 50% of the city’s residents have access to piped water
(Department for International Development, 2015).
A second concern is poor sanitation, which is particularly important as it has negative
implications on public health. While the city has a large capacity to treat wastewater, the
connector infrastructure is lacking with only 28% of households being connected to
sewerage. Those who are not connected use individual septic tanks, cess pits, latrines
and communal toilet blocks in informal settlements. Overall, only 72% of the city’s
population has access to adequate sanitation. Water and sanitation are only two of the
various types of infrastructure whose supply in the city is inadequate. Others are
electricity (power outages are common), roads (traffic congestion is severe), waste
management and social and community facilities such as health facilities, fire stations,
community centres and markets (Department for International Development, 2015).
According to DFID, an important constraint to the development of these services is lack
of funding, especially for connector infrastructure in the city and low income residential
areas. One avenue for increasing funding for urban infrastructure is land-based financing
instruments such as taxes on property. This type of financing takes place to a certain
extent in Nairobi: for instance, land developers are required to pay 0.05% of the cost of a
new development as an infrastructure levy; moreover, developers of large projects often
provide connector infrastructure and are required to cover the costs of extending the
electricity network to the new development and sometimes also to build social
infrastructure such as schools. However, land-based financing is still limited and the
revenues collected are often not used for improving infrastructure provision, which
contributes to a reluctance by property developers to pay additional taxes (Department
for International Development, 2015).
3.4. Summary
Land tenure practices in Kenya have changed significantly from the days that preceded
colonialism to the present. The evolution has not been linear: customary tenure gradually
gave way to individual, registered titles, a process which was intensified in the years
before independence and which continued after 1963; this process has however been
reversed to a certain extent in more recent years, with customary tenure being
recognised alongside individual titles in the National Land Policy approved in 2009.
Kenya still faces significant challenges in offering “accessible and adequate housing” to
its citizens, a right which they are accorded in the new 2010 constitution (Republic of
Kenya, 2010, art. 43 (b)). A significant share of the population still lives in low-quality,
precarious houses to which they do not have a formal right and which often lack access
to basic infrastructure. This is due in part to a lack of supply of adequate housing as well
34
as to the fact that the few houses that are built and sold every year cannot be afforded by
most Kenyans, who lack access to mortgage finance. The functioning of land and housing
markets is also impeded by inefficient and often corrupt bureaucracy that increases the
cost and time necessary to complete property transactions.
References
Amnesty International. (2009). Kenya: The Unseen Majority: Nairobi's Two Million Slum-dwellers. London: Amnesty International Publications.
Amnesty International. (2015a). Kenya: Authorities must keep promise to compensate victims of forced eviction. Retrieved from https://www.amnesty.org/en/latest/news/2015/10/kenya-authorities-must-keep-promise-to-compensate-victims-of-forced-eviction/
Amnesty International. (2015b). Kenya: Stop forced evictions in Mathare and resettle the homeless. Retrieved from http://www.amnestykenya.org/media-centre/news-releases/51-kenya-stop-forced-evictions-in-mathare-and-resettle-the-homeless.html
Arvanitis, Y. (2013). African Housing Dynamics: Lessons from the Kenyan Market. Africa Economic Brief, African Development Bank Group, 4(3).
Bruce, J. (2008). Kenya Land Policy: Analysis and Recommendations: USAID. Central Bank of Kenya. (2014). Bank Supervision Annual Report 2014: Central Bank of
Kenya. Centre for Affordable Housing Finance in Africa. (2014). 2014 Yearbook: Housing Finance
in Africa: A review of some of Africa's housing finance markets: Centre for Affordable Housing Finance in Africa.
Centre on Housing Rights and Evictions. (2006). Listening to the Poor? Housing Rights in Nairobi, Kenya. Geneva: The Centre on Housing Rights and Evictions (COHRE).
Department for International Development. (2015). Urban infrastructure in Sub-Saharan Africa – harnessing land values, housing and transport: Report on Nairobi Case Study: Report 1.8: Department for International Development.
Doshi, M., Kago, C., Kamunde-Aquino, N., Kiguatha, L., Idun, Y., & Chapman, S. (2014). Land Tenure Classifications in Kenya: REDD+ Law Project.
East Africa Royal Commission, 1953–1955, Report. (1955). (Cmd. 9475 ed.). London: Her Majesty's Stationery Office.
Gulyani, S., & Talukdar, D. (2008). Slum Real Estate: The Low-Quality High-Price Puzzle in Nairobi’s Slum Rental Market and its Implications for Theory and Practice. World Development, 36(10), 1916-1937.
Harrington, A., & Chopra, T. (2010). Arguing Traditions: Denying Kenya's Women Access to Land Rights. Justice for the Poor: Research Report(2).
HassConsult. (2015a). The Hass Property Index: Quarter Two 2015 Land Index. Retrieved from http://www.hassconsult.co.ke/images/Q22015/HasslandIndexQ2.2015.pdf
HassConsult. (2015b). The Hass Property Index: Quarter Two Report 2015. Retrieved from http://www.hassconsult.co.ke/images/Q22015/HousepriceQuarter2.2015.pdf
Kanyinga, K. (2000). Re-distribution from Above: The Politics of Land Rights and Squatting in Coastal Kenya. Uppsala: Nordiska Afrikainstitutet.
Karuti, K., Lumumba, O., & Amanor, K. S. (2008). The Struggle for Sustainable Land Management and Democratic Development in Kenya: A History of Greed and
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Grievances. In K. Amanor & S. Moyo (Eds.), Land and sustainable development in Africa (pp. xi, 226 p.). London: Zed.
Land Development & Governance Institute. (2015). Status of Service Delivery in the Land Sector: 18th Scorecard Report: Land Development & Governance Institute.
Migot-Adholla, S. E., Place, F., & Oluoch-Kosura, W. (1994). Security of Tenure and Land Productivity in Kenya. In J. W. Bruce & S. E. Migot-Adholla (Eds.), Searching for land tenure security in Africa (pp. x, 282 p.). Dubuque, Iowa: Kendall/Hunt.
Ministry of Lands and Settlement. (2004). National Land Policy Formulation Process: Concept Paper. Ardhi House.
Nobirabo, P. M. (2013). Local Communities' Access to Justice and the State in Kenya: Impunity, Legal Pluralism and the Resolution of Conflicts. Working Paper. Swiss Network for International Studies. Bern and Zürich.
Omenya, A., & Lubaale, G. (2012). Understanding the tipping point of urban conflict: the case of Nairobi, Kenya. Understanding the tipping point of urban conflict: violence, cities and poverty reduction in the developing world: Working Paper Series. Urban Tipping Point (UTP). Manchester.
Republic of Kenya. (2009). Sessional Paper No. 3 of 2009 on National Land Policy. Republic of Kenya. (2010). The Constitution of Kenya. National Council for Law Reporting. Transparency International. (2014). The East African Bribery Index: Transparency
International Kenya. UN-HABITAT. (2010). The State of African Cities 2010: Governance, Inequality and Urban
Land Markets. Nairobi: UN-HABITAT. UNICEF. Kenya at a Glance. Retrieved from
http://www.unicef.org/kenya/overview_4616.html USAID. (2014). Modernized Land Registries Reduce Conflict in Kenya. Retrieved from
http://www.usaidlandtenure.net/commentary/2014/02/modernized-land-registries-reduce-conflict-kenya
World Bank. (2006). Kenya: Inside Informality: Poverty, Jobs, Housing and Services in Nairobi's Slums. Washington, DC: World Bank.
World Bank. (2011). Developing Kenya's Mortgage Market. Washington, DC: World Bank. World Bank. (2015). Doing Business 2016: Measuring Regulatory Quality and Efficiency;
Economy Profile 2016: Kenya. Washington, DC: World Bank.
36
Transport in Nairobi
4.1. Brief History
The British colonial power considered Kenya’s access to the Indian Ocean to be its main
strategic strength. Indeed, the Northern corridor—which connects the landlocked
countries of Uganda, Rwanda, and Burundi to the port at Mombasa—continues to be one
of the most important transport routes in East and Central Africa.
In 1967, Kenya, Tanzania and Uganda formed the East African Community (EAC) which
created a common market. Under the EAC, Kenya expanded both its rail, road, and air
transport networks. The collapse of the EAC in 1977, however, put an end to this system
and Kenya’s transportation system was placed back under national authorities. In the
1990s, most of these national entities collapsed due to poor management and insufficient
funding. They were replaced by parastatal entities, some of which continue to oversee
transport networks.
Until 2012, Kenya had had no urban transport policy. Prior to this, all transport plans
were included in the multi-sectoral, 5-year National Development Plans. These plans
were typically formulated by the Ministry of Planning and National Development through
a multi-stakeholder consultative process. Many aspects of these plans, however, were not
implemented due to a variety of factors including lack of political goodwill and lack of
adequate funding for identified projects (based on Interview with Prof. Z. Abiero-Gariy,
2014, Civil Engineering Department, Jomo Kenyatta University of Agriculture).
In 2012, Kenya passed The Integrated National Transport Policy which aims to upgrade
infrastructure across the country. This is an integrated plan which coordinates
investment across all transport networks (i.e., roads, railroads, ports, airports, and
pipelines). It is part of the “Vision 2030” plan which aims to elevate Kenya to a middle-
income country.
4.2 Roads
Up to the time of Kenya’s independence in 1963, the road network was developed as a
subsidiary of the railway system. Roads were used as a link between the railways and the
European-owned large scale farming areas. Little or no interest was accorded to rural
areas where subsistence farming was practiced by Africans. Since independence,
measures have been taken by the government to maintain roads and expand the road
system. Such measures include:
• Selective bituminization of heavily trafficked trunk and primary roads and
upgrading of priority earth roads to gravel standards in the late 1960’s and early
1970s;
37
• Development of Special Purpose Roads to serve specific areas of economic
activities (e.g. roads serving areas where main cash crops such as tea, coffee, or
sugar were grown or roads serving the tourist industry);
• Construction of farm-to-market rural roads under the Rural Access Roads
Programme (RARP) from 1974 to 1986. The purpose of the RARP was to provide
access to social and administrative facilities, promote agricultural development
and create employment opportunities;
• Improvement of low-trafficked secondary and minor roads under the Minor
Roads Programme (MRP) from 1986 to link rural access roads to roads of higher
classes;
• Improvement of heavily trafficked secondary and minor roads under the
Gravelling, Bridging and Culverting Programme (GBCP) in the 1970s and 1980s;
• Introduction of public road tolls for road maintenance in 1984/85;
• Introduction of axle load controls in 1986;
• Introduction of the fuel levy and transit tolls for road maintenance in 1994 and
spot improvement of non-maintainable road sections using a combination of
labour and equipment under the Roads 2000 strategy.
Today, Kenya has about 160,886 km of roads of which 63,290 km are classified. Surveys
conducted before 2012 indicate that about 50% of the road network is in good condition
while the balance requires some rehabilitation.
4.3 Investment in Infrastructure
The Ministry of Transport and Infrastructure provides the regulatory framework for
maintaining the road network. As of 2010, funding for the road sub-sector was obtained
from the following sources:
The Exchequer or national budget Local government revenues The Road Maintenance Levy Fund (RMLF) Transit tolls Agricultural Cess Development Partners
Road Maintenance Levy Fund (RMLF)
An important source of revenue for maintaining roads is the Road Maintenance Levy
Fund (RMLF). Total collections from the Fund have gradually risen from Kshs 1.5 billion
in FY 1994/95 to Kshs 26.6 billion in FY 2010/11. Growth in Fund size has accelerated as
a result of increases in the levy and buoyant fuel sales. Transit toll collections have also
38
grown from Kshs 200 million in FY2003/4 to Kshs 310 million in FY 2010/11 (Ministry
of Transport, 2012).
All of the RMLF funds are allocated to agencies for road maintenance and operations
based on their annual work plans. A maximum of 10% of all monies from the fund can be
used for road development. A total of 40% of the fund is assigned to classes A, B, and C
roads to be managed by KeNHA. A total of 32% is assigned to classes D and E and
unclassified rural roads to be managed by KeRRA, while 15% is assigned for urban roads
to be managed by KURA (Ministry of Transport, 2012)
In Kenya, various development partners have been assisting in the development and
maintenance of the road network. The Roads and Transport Sector Donor Group created
the Harmonisation Alignment and Coordination (HAC) initiative consisting of 12 donors
(AfDB, AFD, BADEA, China, DANIDA, EC, JICA, KfW, SIDA, USAID, UNDP, World Bank). As
a result of all these effort, the annual budget for roads increased from Kshs 10.67 billion
in 2002/03 to Kshs 104.22 billion in (2010/2011) (ibid).
FIGURE 4-1: INVESTMENT IN ROADS, 2002-2010 SOURCE: MINISTRY OF TRANSPORT, 2012.
4.4 Railways
Railway transport is the second most important mode of transport in Kenya for both
freight and passenger services. Currently, Rift Valley Railways (RVR) and Magadi
Railways (MR) offer rail services in Kenya with MR operating the line between Konza and
Magadi (146 km) on behalf of the Magadi Soda Company Ltd. while RVR operates the rest
under a concession based on the leasing of locomotives from Kenya Railways Corporation
(KRC).
Currently, four commuter rail services which operate in the Nairobi Metropolitan Area. There are two lines to Thika and Kahawa (in the northeast direction of Nairobi), one line to Limuru (int the northwest) and another line to Embakasi (in the south). These services are currently operated by the Rift Valley Railways which are the concessionaires for
39
Kenyan Railways. Table 4-2 shows the frequency of commuter trains and average passengers per day.
FIGURE 4-2: COMMUTER RAIL SERVICES IN NAIROBI SOURCE: RIFT VALLEY RAILWAYS (KENYA) LTD, 2010.
During the early 1970s, the East African Railways Corporation (EARC) was Kenya’s
largest public sector enterprise and reputedly one of its best managed. It was the
dominant carrier of freight traffic between Mombasa and Nairobi, and controlled a large
percentage of the long distance traffic into Uganda as well. Following its collapse in
1977—it was operated by the former East African Community (EAC)—each member
state became responsible for its own railway network. In 1978, the Kenya Railway
Corporation (KRC) was established through an Act of Parliament. Over time, it has
experienced financial, technical and operational problems arising from poor corporate
governance and inadequate investment.
Weaknesses in KRC management became increasingly manifest in the 1980s. Tariffs
were not being increased in line with inflation and, as a result, real revenues fell. Salaries
and benefits began to fall in real terms, making it harder to attract competent staff. In
spite of its substantial donor assistance, it began to lose market share in the transport
market. During the late 1980s and early 1990s, there was an effort to commercialize its
management and operations. While some measure of commercial autonomy was
achieved, the quality of rail services continued to decline. As a result, KRC was unable to
meet its traffic demand, losing most of its clients to road transport.
In order to improve the performance of the railway sector, the government in 2006 leased
the management and operation of railway services to Rift Valley Railways (RVR) for 25
years. So far the concession has not produced the desired results in terms of improved
performance. Railway freight tonnage transported decreased by 23.4 per cent from 2.3
billion in 2007 to 1.8 billion tonnes in 2008, and further to 1.4 billion tonnes in 2009. The
poor performance of the sector is attributed to poor rail infrastructure and obsolete
equipment. In line with the First Medium Term Plan (2008-2012) of the Kenya Vision
2030, plans are now underway to improve and expand the railway commuter service in
Nairobi Metropolitan area which is expected to increase passenger capacity from 19,000
to 100,000 per day (Ministry of Transport, 2012).
Despite its poor performance in the past, several new railway project have been proposed in recent years. For example, the Standard Gauge Rail (SGR) was officially commissioned in Mombasa in 2013. This project involves the development of a modern high speed, high capacity standard gauge railway for both passengers and freight. It is expected to transfer freight from roads to rail, therefore reducing road damage which occurs due to high usage. In addition, the Government has recently began to revamp commuter rail services
40
in Nairobi and its environs under the Nairobi Commuter Rail Project (NCRP). It has agreed with the Chinese Government on a plan to finance and build a standard gauge track between Mombasa and Nairobi stations. When the standard gauge track is constructed, all the freight trains will be shifted to the new track, and the existing meter-gauge track will be dedicated for passenger services.
4.5 Maritime and Inland Water Transport
The maritime transport system in Kenya consists of one major seaport, Mombasa, and
several other smaller ports (some still scheduled for construction) along the Kenyan
coastline (namely, Funzi, Vanga, Shimoni, Kilifi, Malindi, Lamu, Kiunga and Mtwapa). The
port of Mombasa is one of the most modern ports in Africa It has 16 deep-water berths
that can handle container ships for conventional cargo. In addition, it contains two oil
jetties for refined and crude oil with a capacity of handling tankers of up to 80,000 DWT.
The port is managed by Kenya Ports Authority (KPA) which operates Inland Container
Depots (ICDs) or “dry ports” at Nairobi, Kisumu and Eldoret. Each of these dry ports are
connected to the port by a special rail service (railtainer) for the transportation of
containerised imports and exports. As at 2012, only Kisumu and Nairobi ICDs were
operational (KNBS, 2012).
4.6 Pipeline Transport
The first pipeline in Kenya was constructed in 1978 and covered 450 km from Mombasa
to Nairobi. It was intended to reduce road deterioration on the Kenyan section of the
Northern Corridor as a complementary mode of transport for transporting petroleum
products within Kenya. The westward extension of the pipeline to Kisumu and Eldoret in
the early 1990s considerably reduced the need for heavy oil tankers to collect fuel from
Mombasa or Nairobi to Uganda and other neighbouring countries. Despite these
developments, there is a need to ensure that the pipeline is operated in a manner that
enhances the complementarity of its role with that of other modes. Its management as a
parastatal by the Kenya Pipeline Co. Ltd (KPC) needs to be reviewed to cater for the needs
of the key stakeholders and the public interest. The pipeline’s interface with other
transport modes (such as roads, rail and marine transport) needs to be examined with a
view to enhancing cargo security and safety.
4.7 Air Transport
Kenya has a thriving and viable aviation industry. Historically, aviation in Kenya followed
British rules and regulations until the East African Common Services Organization
(EACSO), the precursor to the EAC, was established in 1963. The three EACSO / EAC
member States, Kenya, Uganda and Tanzania, formed one East African Directorate of Civil
Aviation, which formulated aviation policy for the region borrowing heavily from the
British policy. EAC governments provided aerodrome infrastructure, while the
International Civil Aviation Organisation (ICAO) and the United Nations Development
41
Programme (UNDP) played a big role in the development of human resources and
provision of air navigation equipment. When the former EAC collapsed in 1977, each
member state established its own flight system with its own infrastructure. The first draft
Kenyan aviation policy was written in 1978 and its provisional application served the
industry well. It was revised in 1999, when new concepts like liberalization, code sharing
between airlines and Computer Reservation Systems (CRS) were incorporated.
Currently, there are about 570 aerodromes in Kenya, of which 156 are public. Of the
public aerodromes, nine are currently managed by the Kenya Airports Authority (KAA).
Most of these aerodromes are financially unviable, resulting in serious problems in their
operation and maintenance. Although Kenya has a draft policy and regulations on the
management of manned aerodromes, implementation has been weak. There is a need,
therefore, to strengthen the development and management of aerodromes and to
integrate them with other modes of transport to enhance their economic value (Ministry
of Transport, 2012).
References
Government of Kenya. 2014. Economic Survey 2014. Nairobi: KNBS.
Government of Kenya. 2012. Ministry of Local Government, National Urban Development
Policy (Draft) 2012.
Government of Kenya. 2012. Ministry of Justice, National Cohesion and Constitutional
Affairs. Understanding the Constitution of Kenya, May 2012, Kenya National
Integrated Civic Education Programme (K-NICE).
Government of Kenya. 2013. Kenya Vision 2030 Progress Report. Nairobi, Kenya.