Nine county governments in Kenya faced a loss of $260 million in leveraged co-investments planned as part of the second stage of a now terminated U.S.-funded environmental project. These governments had already put in a first tranche of funding as part of a co-investment agreement with USAID; when the project was terminated, the investments were not matched as planned.

Date: 6/26

Region: Africa

Country: Kenya

Topic: Climate & Environment

Policy Lens: Economic & Trade Interests

Entry Type: Secondary Effect

Additional Context: This information is based on 150 semi-structured interviews conducted by One Earth Partners across five countries selected to represent the diversity of USAID's environmental work. Interview findings were triangulated with a global survey of 175 respondents and external media analysis.

According to One Earth Partners, in Kenya, USAID had engaged in joint work planning and co-investment with nine different county governments for climate resilience projects focused on water and food security. Under these agreements, the county governments would contribute 30% to 40% of a project's total cost, and USAID would supply the remaining balance. To demonstrate their commitment and prove that their local funds were truly available, the county governments were asked to disperse their first tranche of funding at the beginning of the projects. However, by the time the projects reached their second phase — when the USAID resources were scheduled to be injected to achieve the joint outcome — the U.S. funding was abruptly withdrawn. Because the local governments had put in their money in good faith first, the sudden loss of the U.S. funds meant the projects could not be completed, stranding over $260 million in leveraged co-investments across the nine counties.

Source: One Earth Partners (Full report forthcoming).