China has raised hopes of completing stalled Standard Gauge Railway (SGR) project under a grand Horn of Africa masterplan announced during a tour of Mombasa by Chinese Foreign Minister Wang Yi.
Speaking about Mombasa-Nairobi rail link, Yi said the infrastructure could be extended to the Uganda border, while the Addis Ababa-Djibouti line may be expanded to five other countries.
Under the plans, Yi disclosed during last week’s visit by the Chinese minister, the Mombasa-Nairobi Railway will be extended to Uganda, Rwanda, South Sudan, and eventually to the Democratic Republic of Congo.
“This is part of our effort to help this part of the region accelerate the building of industrial belts and economic belts to create more jobs,” Yi said at a briefing with the Kenyan counterpart Raychelle Omamo in Mombasa.
National Treasury borrowed in excess of $3 billion (Sh339.45 billion) from China to build the 472-kilometre railway from Mombasa to Nairobi and borrowed another $1.5 billion (Sh169.73 billion) for the second time to extend the rail from Nairobi to Naivasha.
Financial viability
However, the rail project stalled in Naivasha after it became clear that Kenya will struggle to repay its loans and also amid claims that Kenya had not made clear the financial viability of the project.
The 120-km Nairobi-Naivasha SGR was expected to transform the country’s hinterland through enhanced movement of passengers and cargo.
Yi did not revisit the financial aspect of the project which was the major reason the project came to a halt.
However, Kenya is still battling heavy public debt and has been seeking debt relief to help free up cashflow even as it raises taxes across the board.
As a result,the government has rehabilitated the old meter gauge line that is rather slow with trains taking up to 12 hours between Nairobi and Kisumu.
This will see cargo move seamlessly from the Port of Mombasa to Malaba and to the East African region, as the process to put the SGR and meter gauge railway link line in Naivasha into operation continues.
Kenya Railways Managing director Philip Mainga said the corporation has run the first trial freight train on the new constructed link connecting the Standard Gauge Railway and Meter Gauge Railway in Naivasha, which means the facility is ready for business.
The Naivasha Inland Container Depot located at Mai-Mahiu can handle 120,000 Twenty-foot Equivalent Unit (TEUs) annually and can handle transit cargo to the Great Lakes Region including Uganda, South Sudan, DR Congo, Northern Tanzania, Rwanda, and Burundi.
But with China’s plan for expansion, this could see SGR connecting Malaba and East Africa region to the Horn of Africa, which has been one of Beijing’s main strategic objectives in Africa as a way of boosting connectivity.
The projects, if successful, could help speed up the ongoing regional integration initiatives and help connect the coastal towns to the landlocked economies.
But given the huge cost of such projects, it would be a wait-and-see scenario given that China had earlier threatened to takeover ports and critical facilities of African nations that had faltered in their debt service.
Yi was on a visit to promote peace in the region, especially with regard to Ethiopia, Somalia and South Sudan an area that China has massively invested in.
Conference on peace
“We suggested countries in this region convene a conference on peace in the Horn of Africa.
We will continue to play even a bigger role in peace and stability in this region,” Yi said at the briefing with Omamo, in Mombasa.
China has major interests in Ethiopia, which is engaged in a deadly civil war in the Tigray region. China loaned Sh1.3 trillion to Ethiopia between 2000 and 2019.
Beijing financed and built the Addis Ababa-Djibouti railway. Additionally, Chinese companies are constructing part of the Grand Ethiopian Renaissance Dam.