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January 8, 1997
H.E. Musalia Mudavadi
Minister of Finance
Ministry of Finance
P.O. Box 30007
Nairobi Kenya
Dear Sir:
           KENYA:  Universities Investment Project (Credit No. 2309 KE)
                   Amendment
     We would like to refer to the Development Credit Agreement between
the Republic of Kenya (the Borrower) and the International Development
Association (the Association) for the Universities Investment Project
dated December 11, 1991.  We would also like to refer to your letter
of December 13, 1996 proposing certain amendments to the Development
Credit Agreement.
     We are pleased to inform you that the Association has agreed to
your proposal, and the Development Credit Agreement will be amended as
follows:
1.   Section 4.02 will be amended to read as follows:
     "Section 4.02. The Borrower shall, from July 1, 1994, fully fund
     the operating budget of CHE with respect to university coordina-
     tion, planning and financial functions at a level satisfactory
     for the Association."
2.   The table in Schedule 1 to the Development Credit Agreement is
hereby amended as in the Attachment to this letter.
     Please confirm your agreement to these amendments by signing,
dating and returning to us the copy of this letter.  The amendments
will become effective as of the date of your signature.
Sincerely,
Harold Wackman
Country Director, Kenya and Djibouti
World Bank, Nairobi
Attachment
CONFIRMED:
By:  /s/ Musalia Mudavadi
         Authorized Representative
         Republic of Kenya
Date:    1/20/97
                                SCHEDULE 1
                  Withdrawal of the Proceeds of the Credit
1.   The table below sets forth the Categories of items to be financed
out of the proceeds of the Credit, the allocation of the amounts of the
Credit to each Category and the percentage of expenditures for items so
to be financed in each Category:
                            Amount of the
                               Credit                % of
                             Allocated           Expenditures
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                           (Expressed in            to be
     Category             SDR Equivalent)          Financed
(1)  Equipment, library                          100% of foreign
     supplies and                                expenditures,
     vehicles:                                   100% of local
                                                 expenditures
                                                 (ex-factory
                                                 cost) and 80%
                                                 of local
                                                 expenditures for
                                                 other items
                                                 procured locally
     (a)  for Parts A.1       800,000
          through 3 of the
          Project
     (b)  for Part A.4        600,000
          of the Project
     (c)  for Part B of
          the Project:
          (i)  the first   14,300,000
               phase
          (ii) the second  11,650,000
               phase
         (iii) the third            0
               phase
(2)  Consultants'                                100%
     services, studies
     and training:
     (a)  for Parts A.1     1,700,000
          through 3 of
          the Project
     (b)  for Part A.4        500,000
          of the Project
     (c)  for Part B of
          the Project
          (i)  the first    2,332,000
               phase
          (ii) the second   3,218,000
               phase
         (iii) the third            0
               phase
(3)  CHE incremental          550,000            100% until June 1994;
     operating costs                             beginning July 1994,
                                                 60% of costs relating to
                                                 preparation of bidding
                                                 documents only
(4)  PIU incremental          350,000            60%
     operating costs
(5)  Refunding of               1,080            Amounts due
     Project                                     pursuant to
     Preparation                                 Section 2.02 (c)
     Advance                                     of this Agreement
(6)  (a)  Civil works       4,498,920            100% of foreign
          for Part C                             expenditures and
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          of the Project                         90% of local
                                                 expenditures
     (b)  Vehicles, equip-    350,000            100% of foreign
          ment and furniture                     expenditures and
          for Part C                             90% of local
          of the Project                         expenditures
     (c)  Consultant's        450,000            100%
          services under
          Part C of the
          Project
(7)  Unallocated                    0
                           __________
          TOTAL            41,300,000
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