Funding delays Tanzania-Rwanda SGR project

Monday January 30 2017

The Ngong tunnel on the Nairobi to Naivasha standard gauge railway. FILE PHOTO | SALATON NJAU |

The Ngong tunnel on the Nairobi to Naivasha standard gauge railway. FILE PHOTO | SALATON NJAU |  NATION MEDIA GROUP

By IVAN MUGISHA

The timelines for the construction of the Central Corridor standard gauge railway project connecting Tanzania, Rwanda and Burundi have become hazy, as partners report increasing difficulty in concluding funding arrangements for the $7.6 billion project.

Although officials in Kigali say Rwanda and Burundi agreed to keep their political differences out of the 1,672km project that promises their landlocked territories a low-cost link to the port of Dar es Salaam, they now say it is no longer realistic to speculate on timelines for implementation until funding is secured.

“There is no specific deadline for its completion. If the money is available, the project will take about five years to complete. But for now, we cannot tell when we will start or finish,” said Jules Ndenga, acting co-ordinator of the Special Project Implementation Unit at the Rwandan Ministry of Infrastructure. “We have to first get money. Negotiations are ongoing and we are optimistic that they will be fruitful.”

Two years ago, the Ministry of EAC Affairs suggested a 2016-2020 timeframe for construction of the SGR after Rwanda opted to prioritise the Central Corridor line for its connection to the sea, after similar delays in the competing Northern Corridor SGR line that would have seen the country connected to Mombasa through Uganda.

Northern Corridor

Construction of the Northern Corridor line is now progressing towards Naivasha to the west of Nairobi while the section between Mombasa and Nairobi is set to begin operations mid-2017.

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Uganda will start construction of the 273km link between Kampala and Malaba later this year. Construction of that phase will take four years — the time Kenya is expected to have extended its line to the border with Uganda.

Officials said that negotiations to acquire the required funding were ongoing with potential funders such as the China Exim Bank and the African Development Bank, but progress is slow because the viability of the line in each of the countries has to be assessed independently. Countries will then make joint commitments on the operations of the completed project.

“Transporting a 40ft container between Kigali and Dar es Salaam which currently costs about $5,000 by road, will likely cost half that by railway. That is the importance of this project,” Mr Ndenga said.

About two thirds of the proposed line runs through Tanzania before a tee-off to Kigali and Bujumbura at Isaka, a small town in Shinyanga region.

Tanzania said it will begin constructing its section of the railway line this July, and has allocated $500 million in the 2017/18 budget for that purpose.

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