Senators are demanding that the Sh23.5 billion County Aggregation Industrial Parks (CAIPs) projects be stopped until a master plan is put in place and the 47 county governments do comprehensive feasibility studies.

The Senators want the Ministry of Trade, Investment and Industry to table a comprehensive report on the procurement of the construction of the County Aggregation Industrial Parks and the contractors who are participating in the projects.

Senate Trade Committee, chaired by Kwale Senator Issa Boy Juma, put Trade Cabinet Secretary Lee Kinyanjui on the spot over the National government-initiated CAIPs without conducting feasibility studies and allowing Counties to decide on their needs.

Vihiga Senator Godfrey Osotsi raised concerns about land ownership where the Industrial parks should be constructed, questioning if the feasibility studies were done before the commencement of the projects, with some of the land set out belonging to other counties.

“In Vihiga County, the parcel of land earmarked for the Industrial Park belongs to Kenya Railways; that is why we are calling on the Ministry of Trade to halt the construction of the parks, Instead, we should use the 13 counties that have already completed them for experimental purposes,” said Osotsi.

The Senator said the 13 Counties should be used to see if the programme is working, even as it is stopped in the other counties that have not started, until there is a good master plan and a comprehensive viability study in the remaining counties.

Osotsi sought to know the level of involvement of Counties in the procurement process of these industrial parks since the law states that if there is one level of government implementing a function of the other government, then there is a need to have an Intergovernmental Agreement to ensure proper oversight and procurement processes.

Kinyanjui disclosed that the Ministry acknowledged the need for better oversight and procurement processes, with plans to improve the situation in future projects, admitting that some steps were omitted, but the broad conceptualization of the project is good.

“The Ministry of Trade is working on a master plan for industrial parks to inform development and avoid past mistakes, and they working on improving the procurement process and ensuring better oversight to address the challenges identified,” said Kinyanjui.

Busia, Bungoma, Nakuru, Trans-Nzoia, Migori, Homa Bay, Siaya, Kisii, Nyamira, Meru, Garissa, Mombasa, Machakos, Uasin Gishu, Kirinyaga, and Embu County governments have already completed phase one of the projects.

The Industrial parks aim to promote and attract investments in value addition for products from agriculture, fisheries, and livestock farming by raising the productivity of key value chains.

Kinyanjui told the committee that apart from the phase one counties being funded jointly between the two levels of government, 20 other counties out of the remaining 34 have initiated construction with their funding and reporting construction progress above 10 per cent.

He said that in the financial year 2023/2024, the National Government allocated Sh4.7 billion for the project, with Sh4.5 billion meant for the construction of CAIPs in phase one counties and Sh200 million for program support, project coordination, monitoring, and capacity building.

However, during the supplementary budget 2023/2024, the budget allocation for CAIPs was reduced from Sh4.7 billion to Sh4.5 billion, and by the close of the financial year, the National Government had only disbursed Sh1.152 billion, resulting in an outstanding balance of Sh3.348 billion for phase one counties.

“The State Department for Industry has been allocated Sh2 billion for the construction of CAIPs in the financial year 2024/2025. There was an outstanding balance of Sh3.348 billion with this allocation; it still has a deficit of Sh1.348 billion to complete the construction of CAIPs in the initial phase one counties,” said Kinyanjui.

In the first half of the financial year, the National Government disbursed Sh1 billion, which now brings the total disbursement to counties to date to Sh2.152 billion.

Article 3(a) of the Intergovernmental Agreement on the establishment of the County Aggregation and Industrial Parks asserts that the National Government, through the State Department for Industry, shall transfer to each County Government a sum of Sh250 million for the construction of CAIPs as a conditional grant.

The National government has so far disbursed Sh2.03 billion to 13 Counties, including Kisii and Wajir, Sh250 million each, Kwale Sh197 million, while Migori, Meru, Embu, Busia, Bungoma, Machakos, Uasin Gishu, Garissa, Homa Bay, and Kirinyaga have been given Sh133.3 million each.