Jul 27, 2012
Big Kenya–Uganda railways overhaul poised to beginBack
Construction|Mombasa|Nairobi|Port|Africa|Road|RVR|System|Africa|Burundi|China|Democratic Republic Of Congo|Egypt|Kenya|Rwanda|South Africa|Uganda|USD|Mombasa Port|Railway Network|Transport|Tury-old Railway Network|Brown Ondego|Infrastructure|Rail
© Reuse this
Just when the authorities in the two countries had once again started expressing reservations about Rift Valley Railways’ (RVR’s) ability to transform the archaic system, the company has revealed rehabilitation work is about to start, following the arrival of rail bars and sleepers from China worth $19-million.
RVR CEO Brown Ondego says the arrival of the consignment heralds the beginning of the programme to revive the fortunes of the railway network in the two neighbouring countries.
“The delays we have been experiencing were due to delays in releasing of funds by our fin- anciers. Now that they have started to release the funds, we are not wasting more time,” he says.
Recently, RVR took delivery of 6 869 t of rail bars and 10 000 sleepers from China that will be used to repair some 70 km of sec- tions of the permanent way between Kenya’s capital, Nairobi, and the coastal city of Mombasa.
According to Ondego, this is the first step in a comprehensive five-year turnaround programme aimed at transforming railway transport in Kenya and Uganda. The programme has a price tag of $168-million, which is being funded by a consortium through a syndicated loan.
Early this year, the financiers released the first tranche of the loan – $49-million – which enabled RVR to procure the rail material from China.
“We intend to start laying the permanent way imme- diately because we want to increase the speed of trains and increase haulage,” he states.
Meanwhile, a report compiled by the Joint Railway Commission, a body set up by the two governments to oversee the performance of RVR, states the company is still underperforming on most of the parameters set out in the 25-year concession.
For instance, RVR managed to transport a mere 1.7-million tons of cargo in 2011 of about 10-million tons of cargo arriving at the Mombasa port. This means that about 90% of the cargo arriving at the port destined for Uganda, South Sudan, Rwanda, Burundi and parts of the Democratic Republic of Congo is transported by road.
RVR, which is owned by Egypt-based private-equity firm Citadel Capital and Kenyan infrastructure firm TransCentury, was originally owned by South Africa’s Sheltam Railways.
The company operates 100 loco- motives, 3 500 wagons and the 2 352 km rail track in a concession spanning 25 years.
“Our primary focus is to improve the condition of the permanent way so as to improve transit times as line speeds will increase from the current restrictions of between 25 km/h and 30 km/h to 70km/h,” explains Ondego.
On the Ugandan side, RVR has embarked on the construction of nine culverts between Busembatia and Jinja at a cost of $4.9-million.
The programme is being financed by the International Finance Corporation ($22- million), the African Development Bank ($40-million), the German Development Agency ($32-million), the Dutch Develop-ment Bank ($20-million), the ICF Debt Pool ($20-million), the Belgian Investment Company for Developing Countries ($10-million) and Kenya’s Equity Bank ($20-million).
Edited by: Martin Zhuwakinyu© Reuse this Comment Guidelines (150 word limit)
Other News This Week News
Recent Research Reports
Real Economy Year Book 2014 (PDF Report)
This edition drills down into the performance and outlook for a variety of sectors, including automotive, construction, electricity, transport, steel, water, coal, gold, iron-ore and platinum.
Real Economy Insight: Automotive 2014 (PDF Report)
This four-page brief covers key developments in the automotive industry over the past 12 months, including an overview of South Africa’s automotive market, trade figures, production and the policies influencing the sector.
Real Economy Insight: Construction 2014 (PDF Report)
This five-page brief covers key developments in the construction industry over the past 12 months. It provides an overview of the sector and includes details of employment in the sector, infrastructure and municipal spending, as well as insight into companies’...
Real Economy Insight: Electricity 2014 (PDF Report)
This five-page brief covers key developments in the electricity industry over the past 12 months, including details of State-owned power utility Eskom’s generation activities, funding and tariffs, independent power producers and prospects for the sector.
Real Economy Insight: Road and Rail 2014 (PDF Report)
This six-page brief covers key developments in the road and rail industries over the past 12 months, including details of South Africa’s road and rail network and prospects for both sectors.
Real Economy Insight: Steel 2014 (PDF Report)
This four-page brief covers key developments in the steel industry over the past 12 months. It provides an overview of the global and South African steel and stainless steel markets, South Africa’s major steel producers and events that have shaped these markets.
This Week's Magazine
South African construction company Group Five says work on the rehabilitation of the 800 km stretch of the Plumtree–Mutare highway, in Zimbabwe, should be completed by the end of this year. Giving evidence before the Parliamentary Porfolio Committee on Transport...
The Space Operations division of the South African National Space Agency (Sansa) revealed on July 17 that it had supported the successful launch of the US National Aeronautics and Space Administration’s Orbiting Carbon Observatory-2 (OCO-2) satellite on July 2. The...
Phase 1A of Johannesburg’s Rea Vaya bus rapid transit (BRT) system should carry around 42 000 people a day, while it was been expected that Phase 1B, rolled out last year, would add another 60 000 daily passengers. However, the entire system is currently carrying...
A stormwater project in Bedforview, east of Johannesburg, has stalled for eight months after project managers in the Ekurhuleni municipality resigned and municipal managers were placed on special leave without designating replacements. Construction to reinforce the...
The design of the Beit Bridge border post is the biggest impediment to efficient freight movement between Zimbabwe and South Africa, says Cross-border Road Transport Agency CEO Sipho Khumalo. Beit Bridge is the busiest border post in Africa. A research study on the...