Kenya Railways Losses Hit 24.2 Billion Shillings

Kenya Railways seems to be running on the wheels of debts and losses and ever sinking in a hole with no hope of turning back. For the period that ended June 30, 2020, Kenya Railways has registered 24.2 billion shillings in losses.

The current losses are three times from the 8.5 billion shillings (losses) registered in 2019 begging the question of whether having the Standard Gauge Railway was a wise decision. SGR was supposed to generate revenue and pay for itself, but nothing like that is happening.

Kenya Railways owed the Government an outstanding loan amounting to 539.3 billion shillings out of a total of  928.9 billion shillings that State corporations owed the Government at the end of the last financial year.

Kenya Railways had the highest stock of outstanding loans to the Government, loans that the state procured for KR to enable it to implement the SGR project. With the losses, the billions of shillings secured will fall on Kenyans to foot and settle.

During the period under consideration, the balance sheet size of Kenya Railways grew to 761 billion shillings due to its investment in phase two A of the Standard Gauge Railway (SGR) project. KR net assets are estimated at 634 million shillings.

Commercial State Corporations posted a decline in net profit in the 2019/20 financial year 5 billion compared to 31.7 billion shillings the previous year; the huge drop attributed to massive losses by Kenya Railways Corporation.

State agencies seem to be on a mission to make losses. The KR report comes out with other reports that KBC, Kenya’s oldest broadcaster is broke and owes debts that are more than 100 percent of its current assets. Corruption among state officials has been blamed for the losses.

Should most of these state agencies be sold to private individuals so that the competition and innovation can be solid and save the taxpayer from losing billions?