President Kenyatta set to break ground for the new railway line today

TODAY IS D-DAY FOR NEW RAILWAY LINE

(Posted 28th November 2013)

President Uhuru Kenyatta is expected to attend the ground breaking ceremony later today, when the new standard gauge railway line between Mombasa and Nairobi is launched.

With all contracts now in place, work of the first section between the two cities is expected to take until late 2016 with work on the second section from Nairobi to the Ugandan border at Busia commencing thereafter.

Kenya, Uganda, Rwanda and South Sudan have agreed on the construction of the new railway line to link East Africa’s main port of Mombasa with the hinterland, connecting in particular Rwanda and South Sudan which presently have no railway links and therefore depend on their entire imports and exports to be transported by road. The new railway is also expected to resume passenger train operations – presently Rift Valley Railways only operates three passenger trains per week between Nairobi and Mombasa and none at all to Kisumu – to make long distance transport safer and more affordable for the people of East Africa.

The project is largely financed by Chinese banks and the loans are guaranteed by China’s Exim Bank while Kenya will contribute to the cost of the project through a dedicated railway fund with a levy of 1.5 percent on the landed cost of all imports, which this year alone will already bring some 15 billion Kenya Shillings into the coffers of the project.

Only yesterday was it learned that for next year the Kenya government will triple its funding allocation to the railway project, showing some keen commitment to not just get it off the ground later today but to get it completed on the fast track too.

While the financing of the Kenyan sections of the new standard gauge railway is already secured are Uganda and Rwanda still negotiating over terms and conditions. South Sudan, not yet a member of the East African Community, which will incidentally hold its regular Head of State Summit this coming weekend in at the Commonwealth Resort in Munyonyo, a suburb of the capital Kampala, is also seeking to find finance for the section from the Uganda border to Juba, a substantial challenge for them as South Sudan is at the same time also seeking foreign finance for the proposed pipeline to the new port of Lamu in Kenya as well as the railway link which will run parallel to the pipeline corridor.

In a related development it was also confirmed that the new railway line will get support from the port of Mombasa which has reportedly signed an MoU with the Kenya Railways Corporation guaranteeing an unspecified amount of cargo to be committed to the new rail operation. This has raised the alarm with Rift Valley Railways it is understood, which has in recent months moved towards full compliance, if not exceeding targets, with their own concession agreement running the present narrow gauge rail line between Mombasa via Nairobi to Kampala and reactions are awaited in coming days, just how the distribution of cargo volumes will eventually play out between RVR, the new standard gauge railway very likely operated directly by Kenya Railways and the freight companies using road transport to carry containers inland.

In view of the short time available after getting the information yesterday evening it was not possible to ascertain if Presidents Museveni and Kagame will join the ground breaking ceremony in Mombasa as was for long expected.

Watch this space for regular and breaking news from across the entire East Africa.

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