ROADS minister Franklin Bett has expressed concern over the slow pace of the construction of Narok-Mai Mahiu Road.

Bett asked the Italian contractor, Maltauro, to ac-celerate the work as the road is a key link to the Maasai Mara game reserve, which is listed as one of the new seven world wonders.

He blamed the delay on the frequent breakdown of equipment used by Maltauro Construction Company and warned contractors to � nish the road as stipulated in their contracts as the Gov-ernment would not condone any further delay.

The minister, who was touring the Narok-Nakuru Road, was responding to a

request by Maltauro Area Manager engineer Orlando Cappellali for the extension of the contract by six and a half months.

Capellali explained that the delay was caused by post-election violence and a problem with the quarry site where the contractor gets building materials.

The road was due for

completion by April this year. If the extension is granted, the Sh3.8 billion project will be completed by November.

Minister for Heritage William ole Ntimama asked the Ministry of Roads to tarmac the Narok-Mau Narok-Nakuru Road so as to facilitate transport of farm produce to markets.

BY PETER KIRAGU

DONOR pressure could be the reason behind Treasury’s move to cut non-priority ex-penditures in government ministries.

Finance PS Joseph Kinyua hinted to the possibility that Treasury was under intense pressure to slash non-essen-tial spending or risk losing development partners.

“If the development part-ners � nd that we are not taking any steps on our side, they are going to stop helping us,” Kinyua told the Star on Thursday at Treasury build-ing when he accompanied � nance minister Uhuru Keny-atta to announce new meas-ures aimed at reforming the Capital Markets Authority.

Kinyua said this as he an-swered a question on the list of areas that would be af-fected in a new programme aimed at cutting non-priority expenditures in government.

This statement, however, paints a picture of a govern-ment that has gone back to its begging knees after years of boasting that it could foot all its budgetary bills.

Earlier, Prime Minister Raila Odinga led a govern-ment delegation in a meeting with Kenya’s donors, who

expressed concern over ris-ing cases of corruption in the grand coalition government.

The meeting was held at the KICC.

On the budgetary cutbacks, Kinyua said they were yet to � nalise on the list of the ar-eas that would be affected in the programme. The PS said a technical team from the Treasury and the Prime min-ister’s of� ce was still work-ing on the areas where funds would be diverted from.

“Yes it is true we are work-ing on our menu of expendi-ture but all I can say now is that we are still working on it,” Kinyua said.

He said the list would be known in about two week’s

time meaning the announce-ment would be made some-times this week or next week.

“What the Prime Minister is doing is to see that there are more funds available to cre-ate employment for the youth and to address the food situ-ation in the country,” Kinyua said and added that the an-nouncement of the budgetary cuts would be made public.

“We will call you in about two week’s time.” Speaking in a different forum earlier, Rai-la said the government had managed to save up to Sh9 billion through re-prioritising of expenditures though he did not disclose which sectors had been affected.

Last December, the Star

had established that recurrent expenditure including travel, purchase of new motor ve-hicles, training and hiring of new public servants were likely to be stopped.

Sources at Treasury also said development of expendi-ture in certain urban road projects would be affected.

However, the government got a major boost last week when it managed to raise Sh18.5 billion through an in-frastructure bond.

The bond attracted Sh26.9 billion in total and CBK gov-ernor Njuguna Ndung’u hint-ed that the government could issue a new bond to collect the surplus needed badly at the moment.

12 NAIROBI STAR Monday, 23 February 2009

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DONORS PRESSURE KENYA ON BUDGET

ALY KHAN’SROADS minister Franklin Bett has expressed concern

He blamed the delay on the frequent breakdown of

request by Maltauro Area Manager engineer Orlando

Can YOU outsmart the expert?

STAR BIZ

THERE’S A LOT OF CASH AROUND

THIS week Government of Kenya sold 18.5 billion worth of bonds and the offer was oversubscribed by 45 per cent.

The bourse would be doing hoops, somersaults and cartwheels if it could get an IPO off with a 45 per cent oversubscription, at this time.

The bond confi rms that there is cash in the economy and interestingly, a great deal of it. It is interesting that the US (as are most countries) is also selling bucket loads of bonds as well.

Investors cannot seem to get enough of them. In the US, Investors briefl y, last year, were prepared to receive negative interest rates on their T-Bills (You pay the Government for the privilege of lending them money! Highly unusual and a powerful signal of a situation that is out of kilter).

This over-arching appetite for Government paper is also happening at a time when nearly every Government wants to borrow more money and run a larger overdraft.

Another signal is the price of gold. I am told President Ahmedinijinad (The President announced that the launch of the Iranian rocket was a blow for monotheism and I am still trying to get round how that works) arrives this week. Gold closed a

whisker below $1,000 on Friday.

Last year we briefl y touched $1,030 and it was 1978 when we were trading at these levels, before that. Then the Iranian revolution was in full swing and the Ayatollah was overthrowing the Peacock throne. Gold always rallies at times of uncertainty and both bonds and gold are signalling that the times have gotten worse and not better, since the new Year. Apparently, more than 3,000 cars have been left at Dubai airport as people have fl ed.

The other advantages are that gold is something you can store, carry and sell with minimum fuss. At a time when paper money values are fl ying around and the likes of Stanford Bank crisis stalk the world, this is certainly an advantage.

The venerable CitiBank’s share is trading at less than $2 and has lost near enough 90% of its value (Prince Talal who carried an outsize position in Citibank and then in a fi t of bravado added heavily to it is surely hurting) in the last 12 months. Bank of America has a similar profi le. Greenspan and others this week called for some bank nationalisations and these two are prime candidates.

You will know things have got a lot worse if over the next few weeks, all the talk is of gold.

Shares go up and down and readers are advised that this column representsMr Satchu’s personal opinions.

Slow Narok road works anger Bett

STARPORTFOLIO

EXTRAVAGANCE: Some of the cars used to ferry ministers and other dignitaries.

PHOTO/CHARLES KIMANI