Kenya's brand-new $1.5 billion railway project

Last month Kenya opened a brand-new $1.5 billion railway line that links its capital city, Nairobi, with Naivasha.

The railway was the second endeavor of a large railway project known as the Standard Gauge Railway (SGR project). The first phase included the construction of a high-speed railway that connects Nairobi with the port city of Mombasa. It opened about 2 years ago but it is less utilized than anticipated, mostly due to its high prices regarding the transport of cargo.

The $1.5 billion railway will have four terminals while 3 routes will be conducted daily. "We are hoping it will help the country's economy as it has done for phase one with tourism in Mombasa," Musembi Mumo, director of Kenya Railway, stated.

Kenya plans to establish an industrial park in Naivasha but the attempt has been delayed. If accomplished, the park will offer investment opportunities with tax breaks to companies and better rates for manipulating the nearby geothermal field to generate electric power.

The railway project was funded by China as part of Beijing’s “One Belt, One Road initiative", a Chinese attempt to connect people between Asia, Africa, Europe and China proposed by President Xi Jinping in 2013. The construction was also carried out by a Chinese company, China Road and Bridge Corporation (CRBC). 

The current phase is not the project's final. Over the following years, the project aims to connect 6 more countries in Africa via the railway's development. The ultimate purpose is to facilitate international commerce.

Kenya's government also planned to establish a railway that would connect Naivasha to the town of Malaba, located in the borders with Uganda. However, the $3.7 billion project was rejected by China after concerns were raised about the attempt's viability. James Macharia, Kenya's Transport Minister, stated that the government will provide a $210 million to restore the old railway line that reaches Malaba. 

Kenya is also focusing on upgrading its road network. According to reports, a total fund to $3.8 billion will be needed. President Uhuru Kenyatta stated that new public-private funds will provide the amount required and a toll expressway that will alleviate traffic congestion reaching Kenya's main airport, will be constructed. 

Referring to the current conditions of Kenya's roads, a local driver said: “It is full of big potholes and we have even lost some lives as cars and motorbikes swerve to avoid the holes.”

Sources: Bloomberg CNN Reuters