President Donald Trump’s administration has terminated a Sh7.8 billion ($60 million) U.S. aid agreement with Kenya that was intended to support Nairobi’s Bus Rapid Transit (BRT) system, dealing a blow to a project aimed at easing the capital’s chronic traffic congestion.
Kenya’s National Treasury confirmed the cancellation last week, stating that the Millennium Challenge Corporation (MCC) Threshold Program — valued at approximately Sh7.8 billion — is slated for termination after Washington issued formal notice.
The grant agreement was signed Sept. 19, 2023, in New York between the U.S. and Kenyan governments and entered into force May 23, 2024, following President William Ruto’s state visit to the White House during Joe Biden’s administration. Under the deal, the U.S. was to provide Sh5.8 billion and Kenya Sh1.56 billion through June 2027.
The program was designed to improve urban mobility in Nairobi, strengthen transport and land-use institutions, and fund infrastructure for safer pedestrian access, gender-inclusive design features and climate-friendly buses for the city’s planned BRT network.
A Treasury statement included in the Sector Budget Proposal Report for fiscal year 2026/27 said the program “is earmarked for termination, and notice of termination has already been received.”
The decision aligns with the Trump administration’s broader review of foreign assistance that began after the president took office for a second term on Jan. 20, 2025. The administration has moved to eliminate or reduce a significant portion of contracts previously managed by the U.S. Agency for International Development (USAID) and other agencies, with Trump announcing plans to cut more than 90% of USAID contracts and $60 billion in overall U.S. global assistance.
In Kenya, the total value of terminated or suspended U.S.-funded contracts now exceeds Sh108 billion, according to government and media accounts.
The MCC grant was expected to directly support BRT Line 2, known as Simba, which is planned to run from Rongai and Bomas through Nairobi’s central business district to Ruiru, Thika and Kenol, with 10 intermediate stations and park-and-ride facilities along Thika Road.
The wider Nairobi BRT system comprises five corridors:
- Line 1 (Ndovu): Limuru–Kangemi–CBD–Imara Daima–Athi River–Kitengela.
- Line 3 (Chui): Tala–Njiru–Dandora–CBD–Ngong, supported by €320 million from European partners for 120 electric buses.
- Line 4 (Kifaru): Mama Lucy Hospital–Donholm–CBD–Karen–Kikuyu, backed by the African Development Bank.
- Line 5 (Nyati): Ridgeways–Outer Ring Road–Imara Daima, financed by a Sh7.3 billion loan from South Korea’s Exim Bank
Construction delays and payment arrears to contractors have already slowed the project, and officials say the loss of U.S. funding will require the government to identify alternative sources.
President Ruto has not publicly commented on the cancellation. At the 2023 signing ceremony, he described the agreement as “an exciting milestone” in U.S.-Kenya ties. Then-Treasury Cabinet Secretary Njuguna Ndung’u said the investment would “strengthen our transport and land sectors and generate benefits for the people of Nairobi and all Kenyans.”
The Kenyan Transport Ministry said it has completed a Bus Management Centre at Kasarani Depot for Line 2 operations, but broader rollout remains stalled.
The MCC, an independent U.S. foreign-aid agency, selects countries for threshold programs based on policy performance in governing justly, investing in people and encouraging economic freedom. Kenya was selected in December 2021.
Neither the MCC nor the U.S. Embassy in Nairobi has issued a detailed public statement on the termination as of Monday.
