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Sh3.7bn taxpayer bill for Malaba rail link


Economy

Sh3.7bn taxpayer bill for Malaba rail link


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Works during construction of phase 2 of the Standard gauge Railway in June 2018. PHOTO | FRANCIS NDERITU | NMG

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Summary

  • Taxpayers will foot a Sh3.7 billion bill for the construction of a line connecting the standard gauge railway (SGR) to the old track from Naivasha to the border town of Malaba.
  • A supplementary budget tabled in Parliament shows that Sh2.7 billion will be spent on the construction between Naivasha Internal container Depot (ICD) and the Longonot railway link.
  • A further Sh1 billion will fund the rehabilitation works of the century-old Longonot- Malaba metre gauge railway as Kenya seeks to create a seamless connection from the Port of Mombasa to Uganda.

Taxpayers will foot a Sh3.7 billion bill for the construction of a line connecting the standard gauge railway (SGR) to the old track from Naivasha to the border town of Malaba.

A supplementary budget tabled in Parliament shows that Sh2.7 billion will be spent on the construction between Naivasha Internal container Depot (ICD) and the Longonot railway link.

A further Sh1 billion will fund the rehabilitation works of the century-old Longonot- Malaba metre gauge railway as Kenya seeks to create a seamless connection from the Port of Mombasa to Uganda.

Construction of the new 23.5-kilometre track from Naivasha to Longonot started in August last year.

Kenya had initially mulled tapping a private investor to fund the project and use a Chinese contractor, but dropped the plan after the firm quoted in excess of Sh50 billion to upgrade the old line and link it to the Mombasa-Naivasha SGR track.

“Sh2.7 billion is for construction of the Naivasha ICD-Longonot railway link and Sh1 billion is for rehabilitation of the Longonot-Malaba MGR,” Treasury Secretary Ukur Yatani said in the supplementary budget.

China Road and Bridge Corporation (CRBC) — which constructed the $4.7 billion (Sh507.6 billion) SGR line from the Port of Mombasa to Naivasha is jointly building the new track with Kenya Railways.

The works are set for completion before end of the year.

Plans to upgrade the metre gauge rail and link it to the SGR came after Kenya failed to secure a multibillion-shilling loan from China, which funded the first and second phases of the modern railway.

The new track and upgrading of the old metered gauge rail are key to enhancing the economic viability of the SGR line through easing movement of cargo and passengers from the Port of Mombasa to Uganda and the neighbouring nations.

The Mombasa to Naivasha SGR line cost an estimated Sh477 billion, including financing costs but its economic viability is heavily dependent on connection to Kampala which is a major user of the Mombasa port for its imports.



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