The Star published on 22 August 2022 an article titled "China Won't Seize Mombasa Port over SGR Loan -- Chinese Official" by Brian Otieno.
Controversy has surrounded the $3.6 billion loan that provided financing for the China Roads and Bridge Company to build the Standard Gauge Railway (SGR) between Mombasa and Nairobi. At one point, there was public speculation that should Kenya default on the loan, China could seize as collateral the port of Mombasa. Wu Peng, the director-general of the Department of African Affairs in the Chinese Foreign Ministry recently stated that no matter what happens Mombasa port will remain a Kenyan asset.
Controversy continues, however, because the winning candidate in the recent presidential campaign, William Ruto, announced during the campaign that if he won he would make public Kenya's loan contracts with China. But the SGR contract contains a non-disclosure clause, which China argues should be observed.
Wu Peng emphasized that when we signed the SGR loan agreement, "there was a commercial secret agreement. That is very common commercial practice." He noted that the Kenyan government will lose credibility should it breach that agreement and this will strain Kenya-China bilateral relations. "The spirit of contract is the cornerstone of doing business. If there is no spirit of contract, how can we do business?" he asked.
