Name and Location
Kenya–Uganda railway rehabilitation project.
Project Description
Rift Valley Railways International (RVRI), a consortium established to manage the parastatal railways of Kenya and Uganda, has proposed a five-year capital expenditure (capex) programme to rehabilitate the railway network.
The Kenya–Uganda railway line has a track length of 2 350 km and runs from Mombasa port, in Kenya, to the Ugandan capital Kampala, with a branch to Pakwach, in north-eastern Uganda.
The project plans to introduce an efficient, reliable and integrated rail system between the two countries and represents a quantum leap in the development of the transport systems of Uganda and other similar landlocked countries.
The upgrade will result in reduced transit times and is expected to lead to an increase in the rail market share of the freight transport requirement.
Value
The project is valued at $287-million.
Duration
The project will take five years to implement, subject to funding being released.
Client
RVR.
Key Contracts and Suppliers
RVR, which is a portfolio company of Citadel Capital, an Egypt-based private equity firm (rehabilitation, operation and maintenance); the International Finance Corporation (IFC), the African Development Bank (AfDB), KfW Bankengruppe, Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden, Equity Bank of Kenya, the Infrastructure Crisis Fund and the Belgian Investment Company for Developing Countries (finance).
Latest Developments
The IFC, a member of the World Bank Group, along with six other leading international finance institutions has extended $164-million in financing to RVR to rehabilitate the 100-year-old Kenya–Uganda railway line.
The package backs a $287-million capex programme planned to improve RVR’s current infrastructure and rolling stock.
The IFC has become the largest financier to RVR, providing a combined $42-million, which is made up of a loan of $32-million, of which $10-million has already been disbursed, and $10-million in equity still to be committed.
Other institutions participating in the package include the AfDB ($40-million), Germany’s KfW Bankengruppe ($32-million); the Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden ($20-million); Kenya’s Equity Bank ($20-million); Cordiant-managed Infrastructure Crisis Fund ($20-million); and the Belgian Investment Company for Developing Countries ($10-million).
The balance of the funding is being contributed by shareholders and generated through operations.
On Budget and on Time?
It is expected that, following the signing of the loan agreements between RVR and the lenders, funding will be released expeditiously for the implementation of the project.
Contact Details for Project Information
AfDB, Hadjajaoul Sabrina, email s.hadjajaoul@afdb.org.
Citadel Capital head of corporate communications Ghada Hammouda,
tel +20 2 2791 4439, fax +20 22 791 4448 or email ghammouda@citadelcapital.com.
IFC (Nairobi), Neha Sud, tel +254 72 034 8499 or email nsud@ifc.org.