Transportation Industry

Roads have long been considered as the prime communication link between all economic sectors and the citizenry in Kenya. Indeed, roads account for over 80% of Kenya’s total passenger and freight transportation, as well as value of output.

Overview

The Transportation industry sector comprises a wide range of service providers, covering all modes of transport – air, road, rail, sea – as well as related services such as warehousing, handling, stevedoring, and finally value added services like packaging, labelling, assembling, etc. Because of the diversity of the sector in Kenya the infrastructure group has defined three key market segments that it concentrates on: Roads, Ports and Airports, Rail and Infrastructure.

Kenya’s current Road Network inventory is estimated at 177,500km comprising 63,000km classified roads and 114,500km of unclassified roads administered by various government departments. This includes national roads, district roads (and unclassified rural roads), urban roads, and special roads (i.e. park roads) which are administered by the Roads Department, District Roads Committee and County Councils, City and Municipal Councils, and various government agencies such as Kenya Wildlife Services, the Forest Department, etc respectively. The Ministry of Transport is in charge of the overall policy on the Transport sector, while the Ministry of Roads and Public Works (MoRPW) formulate the roads’ sub-sector policy.

 

PwC and the Roads sub sector

Globally, PwC firms have worked extensively on road sector assignments advising on a large number of private and public sector road projects. The services we provide in this sector are diverse and comprise the following:

  • Corporate Finance, Audit and Tax Services
  • Private sector participation initiatives (PPPs and subsequent finance raising) and transactions, and implementation thereof i.e. advising Governments on tendering out road concessions and other PPP arrangements, as well as advising bidders on tendering for such projects.
  • Sector policy, regulation, legislation, and support in implementation of reforms.
  • Institutional operational and performance improvement support.

In Kenya, our work in the road sector has encompassed the following:

  • Technical, performance and financial audits of several organisations within the sector and donor funded projects and verification and evaluation of pending bills.
  • Technical assistance and training to operationalise the several newly established regulatory bodies within the sector.
  • Statutory Audits of some operators and
  • Receiverships in lieu of liquidated contractors.

 

 

Challenges facing the Transport Industry in Kenya

  • Rehabilitation and expansion of existing road network
  • Kenya Rural Roads Authority (KeRRA), Kenya Urban Roads Authority (KURA), and Kenya National Highway Authority legislated under the Roads Act. They need to be made operational to ensure better construction and routine maintenance of road infrastructure
  • Restructuring of MoRPW to enable it to effectively carry out responsibilities under its new mandate under the Roads Act
  • Involvement of Private Sector in the financing, construction and maintenance of roads
  • Poor contracting and supervision
  • Severe vehicle congestion.

 

Contact us

Anne Eriksson
Partner
Tel: +254 (722) 516 992
Email

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