Kenya: Standard Gauge Railway Disputes to Be Resolved in China If Friendly Consultations Fails

Nairobi — Disputes arising from the Standard Gauge Railway (SGR) will be resolved in Beijing, China, if friendly consultations fails.

This was revealed in the SGR contract that was signed by Kenya’s National Treasury (representing the Government) and the Export-Import Bank of China.

“Any dispute arising out of or in connection with this Agreement shall be resolved through friendly consultation,” the contract reads.

“If no settlement can be reached through such consultation, each party shall have the right to submit such dispute to the China International Economic and Trade Arbitration Commission (CIETAC) for arbitration,” the document shows.

CIETAC, which is one of the oldest and busiest arbitration institutions in the world, is the leading mediation institution in Mainland China.

Established in April 1956, CIETAC was initially called Foreign Trade Arbitration Commission.

“The arbitration shall be conducted in accordance with the CIETAC’s arbitration rules in effect at the time of applying for arbitration,” it stated.

Yesterday, Roads, Transport and Public Works Cabinet Secretary Kipchumba Murkomen made public SGR contract details that cost Sh670 billion.

Murkomen shared the documents on his social media account as well as with the majority leaders of both the Senate and the National Assembly.

The loan terms place the interest rate of the loan at 2.0 percent per year. The Management fee and Commitment fee of the loan are both pegged at 0.25 percent.

The loan has a 20-year tenure and seven-year grace period

The contract also provides that any goods purchased using proceeds from the SGR will be sourced from China preferentially.

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