While the Court of Appeal recently gave KeNHA a temporary “shield” against a Sh201 million payout, the ghost of the Kisumu Boys Roundabout–Mamboleo Junction project continues to haunt the national budget. What was meant to be a 4.5km symbol of modernization has instead become a case study in project mismanagement and “pay now, argue later” contractual friction.
1. The Abandonment of 2018
The roots of the current crisis date back to December 2018, when the Israeli contractor, SBI International, packed its equipment and left the site.
The Reason: The contractor cited unpaid arrears and constant delays in payment as the primary reasons for walking away from the 8km dualling project.
The Ripple Effect: For years, Kisumu residents have had to endure dust, traffic snarl-ups, and incomplete interchanges at the Mamboleo junction—a critical artery connecting the city to the Lake Basin Mall and the Kisumu-Kakamega highway.
2. The FIDIC “Oxygen” Principle
At the heart of KeNHA’s Sh201 million struggle is a common clause in international construction contracts (FIDIC).
“Pay Now, Argue Later”: These contracts are designed to keep the project’s “oxygen” (cash flow) moving. Even if an employer (KeNHA) disagrees with a Disputes Adjudication Board (DAB) ruling, they are often contractually obligated to pay first and seek arbitration later.
KeNHA’s Nightmare: The agency has been fighting the enforcement of multiple DAB awards, including one for Sh1.3 billion and another for Sh536 million. By failing to file a defense on time in this latest Sh201 million case, they nearly handed the contractor a “default win” without ever presenting their side of the story.
3. The Cost of Legal Delays
As of February 2026, the true cost of this dispute isn’t just Sh201 million—it’s the mounting interest.
Interest Rates: Court documents show the contractor is seeking interest at 3% above the Central Bank of Kenya Base Lending Rate.
Taxpayer Burden: In a fiscal year where the National Treasury is struggling to clear Sh606 billion in pending bills, every month this case drags on adds millions to the eventual settlement.
