By The Mountain Journal in Nanyuki
Laikipia County Government is working to
float a bond to finance major projects that will impact positively on the
people.
The county government is formulating how
it will borrow Sh3 billion from the private sector by floating a bond to
finance flagship projects.
It is the first time for a county government
to venture in the security market in Kenya.
The development bond will be traded in Nairobi Security Exchange, which will be a critical step will be the enactment of Debt Securities Issuance Act by the county assembly.
Deputy Governor John Mwaniki
County Deputy Governor John Mwaniki said the bonds
are investment securities where an investor lends money to companies,
municipalities, states and sovereign governments for a set period of time, in
exchange for regular interest payments.
The county is in the process of preparing
required financial documents including revenue and expenditure projections for
five years. It will prepare Bond Trustee Deed and identify Trustees of the
bond. “With necessary approval from the County Assembly, Intergovernmental
Budget and Economic Council (IBEC) and other relevant agencies, the county will
be able to issue the bond in the market this year,” said Mwaniki.
Mwaniki a financial markets specialist said once
the process which is at the tail end is complete the results will be made
public.
‘Why invest in a Bond A bondholder is
able make an income as a result of returns on the investment and earn much more
interest than money deposited in the fixed account.
“Lending to the government is a highly secure investment and it encourages, cultivates a culture of investing and saving,” the DG said adding that It is a sign of patriotism and an element that demonstrates one’s faith in the government.
Projects earmarked for
financing through the bond issue include water for production, road network,
bus parks, sewer expansion, smart towns, tomato processing, dairies and
feedlot.
Other projects include development of
five large water pans with capacity of 200,000 m³ with complete irrigation
reticulation system.
Road network will involve upgrading of
1,000 kms of agricultural roads linking farms to the market. It will also
establish a tomato processing factory in Rumuruti for value addition.
Also smart town initiative, the county
seeks to upgrade 10 trading centers with proper roads, drainage, green spaces
and street lighting.
These towns are Oljabet, Karuga, Ol
Moran, Pesi, Doldol, Naibor, Kimanju, Wiyumiririe, Matanya and Kalalu.
The bond will finance the expansion of
sewer services in three major urban centers and also establish feedlots in
Laikipia North occupying 5,000 acres of land at a cost of Sh120 million. The
dairy industry will also benefit from a processing factory in Laikipia East.
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