Uganda, Kenya hope to raise $6bn to restart Mombasa railway

China financed the first phases of the project but has been reluctant to back the continuation of the line to Uganda and beyond.

The East African news site reports that the two countries hope to resume the project in  December. Their transport ministers have agreed to work together on attracting investment over the next four months.

At present, the line runs from Mombasa to Nairobi, and then some 90km northwest to the town of Naivasha. The second phase of the SGR was to have laid track between Nairobi as far as Malaba, on the Ugandan border.

Meanwhile, Uganda is planning to build a $2.6bn link between Malaba and its capital, Kampala. From there, the line will eventually branch out to the Democratic Republic of Congo, Rwanda, and South Sudan.

The search for finance

Kenyan transport minister Kipchumba Murkomen said his government was hoping to interest foreign lenders in the scheme.

“We are now going for financiers either from Europe or the UAE, or whoever comes with a good deal for our people in East Africa,” he said.

According to The East African, the UAE may invest in the line to Malaba in return for a stake in Kenya’s Port of Mombasa.

Kenya has had difficulties repaying the Chinese loans it took out to pay for the $3.6bn Nairobi-to-Mombasa line.

In Kampala, the line will be built by Yapi Merkezi, the Turkish contractor that is also building Tanzania’s rival SGR to the African interior, in association with China Civil Engineering, China Railway Construction Company, and Portugal’s Mota-Engil.

A deal on financing is hoped for by 1 November. Ugandan officials will seek help from export credit guarantee agencies, possibly led by the UK’s Export Finance agency. 

In November 2022, Uganda formally terminated its contract with China Harbour Engineering Company (see further reading).

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