Questions arise over President Ruto’s decision to revive Arror, Kimwarer dams construction

The decision by the governments of Kenya and Italy to revive two controversial dams, Kimwarer and Arror, has raised questions over the country’s consistency in making decisions, just four years since President Uhuru Kenyatta cancelled one of the dam projects and directed the restructuring of the other.

For President William Ruto this is part of his election pledges that he had committed to going on with the projects. It also comes at a time when former National Treasury CS Henry Rotich remains in court alongside eight others over the same controversy.

“I am happy to report to the nation that the Governments of Kenya and Italy have agreed,” President Ruto said on Wednesday.

It took a meeting of two presidents to unlock a controversy that is now more than four years old.

It started in September 2018 when it was reported that the Directorate of Criminal Investigations (DCI) had received reports that the two dam projects had been initiated illegally.

Through a series of correspondences and collaboration between the DCI and the office of the Director of Public Prosecutions, in July 2019, the DPP made the decision to charge 28 persons including then-Treasury CS Henry Rotich and his PS Kamau Thugge.

Two Italian firms contracted to deliver the dams and one of their directors were also listed for prosecution.

At the same time, President Kenyatta had tasked a technical committee led by then Infrastructure PS Paul Maringa to assess the viability of the two dam projects.

The team returned a verdict in September 2019 citing Kimwarer dam as overpriced at Ksh. 22.2 billion; that no current and reliable feasibility study had been conducted and that a 1991 study had shown geological faults that made the project unviable. The dam would have sat on a valley according to the technical team requiring pumping of water supply and thus financially unviable.

President Kenyatta immediately cancelled the Kimwarer dam to the uproar of local politicians.

About the Arror Dam, Maringa’s committee found it to have been overpriced. President Kenyatta ordered its rationalization, to reduce its design height from 96 metres to 60 metres and thus reduce the cost from Ksh. 28.3 billion to Ksh. 15.4 billion.

President Ruto then the Deputy President found it a political move to get at him. In July last year during the presidential debate, he said as much.

“These were not projects that were cooked at night. How come the only projects that didn’t go through were these?” He posed in July 2022.

At the time of cancellation, over Ksh. 19 billion had been paid, of which Ksh. 11 billion was an upfront payment for insurance. Ksh. 643 million had been allocated by the National Treasury for land compensation, but no land had been acquired.

When the DPP ordered the prosecution of Rotich and others, he cited that the two projects had been inflated by Ksh. 17 billion to hit Ksh. 63 billion.

In December 2020, the Italian companies including CMC Di Ravinna sued Kenya at the International Arbitration Court, asking for USD114 million for breach of contract. At the current CBK rate, that would be Ksh.14.8 billion.

The president now wants all cases by Kenyans and the Italians withdrawn.

“We as the government of Kenya will withdraw cases against the companies, the companies will withdraw cases at arbitration," said Ruto.

In the four years since Rotich and others were charged, the list of accused persons has been reduced. The Italian firms and a director are no longer listed in the case. Only nine persons remain in the Rotich matter.

 “When I come into office,  I will make sure the money is not lost. I will make sure that the impediment imposed on this project, we will provide the land, the contractor will build the dam and we will move ahead,” President Ruto promised in July 2022.

However, questions remain as to the viability of the Kimwarer dam which had already been declared not feasible. What will happen to the financing given President Kenyatta had ordered a reduction of the cost of the Arror dam by nearly half? One of the Italian firms had also been declared bankrupt dealing a blow to Itare dam whose works had been abandoned. Who will pay for the lost time?

“We have agreed that financing already made available will be restructured. We plan to clear court issues in one month then have a conversation about restructuring on financing and go on with this,”  President Ruto said.