Uganda has suspended the Standard Gauge Railway (SGR) venture and turned its attention to revamping the old metre-gauge railway network until unresolved issues with Kenya and China have been concluded, finance minister Matia Kasaija has said.
“It is apparent the SGR is going to take us a lot of time to complete. First, we have to wait for Kenya to reach at the Malaba [border] point then we can start,”said Mr Kasaija
He said government, in the interim, is refurbishing the old railway line as “an alternative” to lower transportation costs for traders.
Kenya is currently constructing the 120km line from Nairobi to Naivasha at $1.7bn to be followed by a 266km line from Naivasha to Kisumu port at $3.6bn, and later embark on the 107km line connecting from Kisumu to Malaba border with Uganda which is expected to cost $1.7bn.
The first phase of Kenya’s SGR line running from Mombasa port to the capital Nairobi, that cost $3.8bn, was commissioned last year and is operational. The trains’ daily tonnage has increased to more than 800 containers, out of the 1,700 that arrive at the port of Mombasa.
Uganda’s first phase of SGR, the eastern line running from Malaba to Kampala, about 273km (338km rail length), is expected to cost $2.3bn.
President Museveni, according to sources familiar with the venture, in recent months had been directly involved in discussions on the project, and had hoped to secure financing for the first section of the railway line during his visit to China last month when he attended the seventh Forum on China-Africa Cooperation (FOCAC) summit. But he returned empty-handed.
However, Mr Kasaija revealed that during the discussions in Beijing, it was agreed that “Uganda and Kenya will embark on joint financing negotiations” after Kenya has completed the current Nairobi-Naivasha section.
[BUSINESS] Uganda puts SGR on hold over unresolved issues with Kenya: Uganda and Kenya first agreed to construct the SGR in 2008 but the arrangements were only concretised in 2012. https://t.co/uHU8ykmYW5
— Breaking News (@News_Kenya) October 30, 2018