(Nairobi, Kenya) – Kenya would not be facing a heavy repayment burden on the Standard Gauge Railway had the government carried out proper due diligence before starting the project, a new report by Transparency International Kenya has found.
The report, titled Corruption Risk Assessment of Infrastructure Projects in Kenya, describes how governance failures, opaque procurement processes and weak oversight turned one of the country’s most important infrastructure projects into a major corruption risk and debt burden. According to the findings, the SGR recorded the highest corruption risk among three large infrastructure projects assessed between September 2025 and March 2026.
Using the Infrastructure Corruption Risk Assessment Tool, researchers gave the railway project a vulnerability score of 4.49 out of five, placing it in the very high corruption risk category. The report notes that by November 2024, the original Sh539 billion loan used to finance the first two phases had grown to Sh737.5 billion because of accumulated interest from delayed repayment. Converted at current rates, this represents a rise from approximately $4.12 billion to $5.64 billion.
The assessment examined both Kenya’s wider governance environment and the institutional framework surrounding the Kenya Railways Corporation, the agency responsible for implementing the project. Researchers identified several weaknesses that added to the high risk rating. These included limited transparency in procurement, secrecy surrounding contracts, weak grievance mechanisms, not enough public participation and insufficient disclosure of project costs and financing arrangements.
The findings come as Kenya continues to service the multibillion shilling railway project. The railway was launched during the administration of former President Uhuru Kenyatta as a central part of the country’s infrastructure modernisation agenda. It was designed under Kenya’s Vision 2030 blueprint to connect the Port of Mombasa to Nairobi and later extend to Naivasha, with planned expansion to Kisumu and Malaba. However, Transparency International argues that poor project selection processes and governance failures damaged its intended economic benefits.
The report notes that Phase One cost about Sh490.9 billion, with 90 percent of the funding coming from Chinese loans. The second phase, extending the line from Nairobi to Naivasha, cost an additional Sh193.8 billion. The organisation argues that the financial strain could have been reduced had the government put the project through more rigorous due diligence and scrutiny before approval.
The report also raises concerns over the way the project was selected and approved, describing it as an investor led, non public process. Under this model, key decisions were heavily shaped by external financiers and contractors, with limited public oversight. Transparency International Kenya Monitoring, Evaluation, Research and Learning Coordinator Caroline Maina said this framework created chances for weak accountability and reduced scrutiny of critical decisions.
The report also flagged heavy reliance on external financing, limited parliamentary oversight and restricted public access to information as major warning signs that should have drawn greater attention during the planning phase. It revisits long standing concerns over procurement problems surrounding the SGR, pointing to previous court findings that questioned the legality of procurement procedures used in awarding contracts for the railway.
Among the most troubling findings was the secrecy surrounding contractual arrangements. The study found that full project costs, loan agreements and expenditure details were not readily available to the public. This made it difficult for citizens and oversight institutions to independently assess value for money.
Transparency International Kenya Executive Director Sheila Masinde said the organisation is not against development, but there must be fiscal discipline and accountability. She questioned whether the processes are transparent and said declarations must be made public on individuals getting these contracts, noting that this is borrowed money and Kenyans bear the cost of repayment.
The report also noted that dispute resolution clauses require conflicts arising from the project to be handled through arbitration in Beijing, China. It further pointed out that confidentiality provisions prevented parties from publicly disclosing information obtained during contract execution. The lobby group argues that such arrangements limited transparency and complicated accountability efforts.
The findings come against a wider background of governance challenges affecting infrastructure development in Kenya. The report notes that the country loses more than Sh600 billion, equivalent to about $4.58 billion, annually through stalled and mismanaged public infrastructure projects.
Kenya’s overall governance environment was also rated as high risk, with a corruption risk score of 4.125 out of five. Among the factors cited were gaps in whistleblower protection, persistent perceptions of corruption, weaknesses in public procurement systems and the influence of elite networks in public decision making. The report also points to shortcomings in the implementation of key laws such as the Access to Information Act and the Public Finance Management Act, noting that compliance remains inconsistent.
Transparency International concluded that weak public participation, not enough documentation, opaque procurement systems and vested interests remain recurring weaknesses across major public investments. To address these shortcomings, the organisation recommends the proactive publication of project selection documents, contracts and implementation reports, as well as stronger parliamentary oversight.
The report cautions that lessons from the railway’s implementation must not be ignored as the government prepares for new large scale projects, including the planned extension of the SGR from Naivasha to Malaba.