(Ecofin Agency) - In 2022, the agency had already issued guarantees for Standard Bank Kenya to finance a road project. This time, its guarantee is for the construction of a rural road.
The Multilateral Investment Guarantee Agency (MIGA) announced, Monday (Feb 13), the issuance of a US$51.44 million guarantee to South Africa's Standard Bank Group and its Kenyan subsidiary, Stanbic Bank Kenya Limited. The guarantees cover the banks' loans to the Skar Lot 32 Development Corporation for the construction and operation of a rural road in Kenya. They specifically cover the banks' loans against risks of transfer restriction, expropriation, breach of contract, war, and civil disturbance for a period of up to 8.5 years.
This is to the first guarantee, Standard Bank and its subsidiary are securing from the MIGA. In March 2022, the agency issued a US$212 million guarantee to Stanbic Bank Kenya Limited and another private company's loans that were to finance and maintain road sections in Central and Western Kenya.
The new guarantee complements the World Bank's investments in the Kenya road sector. In the country, road is the main transport mode. It accounts for over 80% and 76% of the passenger and freight traffic respectively.