Diplomatic row looming as Spain demands Kenya settles Ksh.1.2B debt

A diplomatic row is brewing between Kenya and the Kingdom of Spain over pending bills amounting to over Ksh.1.2 billion.

Kenya risks paying huge penalties in interest for 10-year delay in payment of the bill to a Spanish company that constructed a multipurpose dam at the lower Ewaso Ngiro.

The Embassy of Spain has written to different government entities to have the money paid with no success.

One such letter written to Treasury says: “The Embassy of the Kingdom of Spain presents its complaints to the Ministry of Foreign Affairs of Kenya and has the honor to forward herewith a letter from Ambassador of the Kingdom of Spain to Kenya.”

The letter from Spain Ambassador to Kenya Javier Garcia de Viedma read in part: “As you are aware the longstanding debt with the Spanish companies TYPSA is yet to be settled...despite the many efforts taken by the company and this embassy to collect the outstanding payments we still have not received any way forward on the issue.”

The letter further noted that the issue is endangering future investments in Kenya and the reputation of the government of Kenya.

In another letter to Head of Public Service Felix Koskei and copied to the then CS for Ministry of East African Community Rebecca Miano, Treasury CS affirmed that the Spanish company was contracted by the Ministry of Regional Development, now Ministry of East African Community, for the detailed design of the lower Ewaso Ng'iro South river multipurpose dam with a contract of Ksh.3.1 billion and Ksh.267.5 million.

The embassy further noted that the pending bills were taken through verification and found to be eligible and payment ought to have been made.

The letters from the Spanish embassy drew the attention of Kenya's Foreign Affairs ministry, then led by Dr. Alfred Mutua, who asked the ministry to balance between mutual beneficial relations between Kenya and Spain and indeed other foreign countries.

The pending bills row also came up during the Kenya-Spain joint business forum that was held in Madrid where Minister for Foreign Affairs Jose Albares Bueno brought up the issue of the pending bills owed to Spanish companies in Kenya.

The government says it is awaiting another round of verification by the pending bills committee chaired by former Auditor General Edward Ouko.

So far, the total pending bills in the national government stands at Ksh.600 billion.