A Focus on the Infrastructure Sector in Nairobi

Nairobi is the commercial center and economic capital due to its well developed infrastructure that includes modern financial and communication systems and wholesale and retail chains. It hosts the county’s largest industrial area which accounts for approximately 20% of Kenya’s GDP.

Despite the positive aspects, the county is faced by various challenges with regard to quality and maintenance of existing infrastructure. The physical infrastructure in the county including most city and residential estate roads are poor conditions, making parts of the city inaccessible.

According to the World Bank, Kenya Economic Update June 2013, Kenya has not been an attractive destination of foreign direct investment (FDI), roads have been a major constraint on the FDI.Good infrastructure lowers the transaction cost, which enable investors to earn returns on their investments, as their enterprises are able to generate profits.

Existing roads in the residential area continue to be damaged by rains and poor drainage systems. Seasonal rains destroy infrastructure due to poor maintenance of the existing facilities causing heavy traffic jams in the city at the expense of the county’s economy.

Power supply in the Nairobi is unreliable and expensive as a result of frequent disruptions and outages. Opportunities exist for Nairobi to partner with the private sector in the development and maintenance of key infrastructure including estate roads, mass transit systems for rail and road.

The government needs to continue with infrastructure investments, by adopting an aggressive program to provide the building blocks for the private sector to expand its operations.In Kenya’s second term plan of Vision 2030,electricity is expected to increase and be fully available in order to improve energy infrastructure network  and promote development and use of renewable energy sources to create reliable ,adequate and cost effective energy supplies to support industrial takeoff for economic development.