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Kenya secures funding from China's Exim Bank to extend SGR to Uganda
Kenya has secured a significant boost for its regional infrastructure ambitions with China’s Exim Bank committing to fund the construction of the Standard Gauge Railway (SGR) extension from Naivasha to the Ugandan border. This development comes after a period of uncertainty surrounding the project's financing.The announcement was made by Kenya’s Cabinet Secretary for Roads and Transport, Kipchumba Murkomen, on the sidelines of a meeting between President William Ruto and his Ugandan counterpart, Yoweri Museveni, last week. This critical section of the SGR is expected to play a pivotal role in enhancing regional connectivity and economic competitiveness. It will provide a vital transport link to Uganda, South Sudan, Rwanda, and ultimately, the Democratic Republic of Congo (DRC).The pressure to complete the project is mounting as neighboring Tanzania forges ahead with its own electrified railway project headed towards the DRC along the Central Corridor.Kenya and Uganda are actively seeking additional funding partners to complement China’s Exim Bank contribution. The pan-African lender, the African Development Bank, and Kenya’s dedicated Railway Development Fund are expected to contribute alongside the Chinese investment. This multi-pronged approach reflects the project's significant cost and underscores the desire to spread the financial burden.The announcement regarding China’s renewed commitment coincides with a recent development that further bolsters the project's prospects. Last week, Rwanda, Burundi, DRC, and South Sudan joined the SGR Cluster Joint Ministerial Committee, pledging to collaborate in securing funding for the railway's expansion.Meanwhile, Uganda is gearing up for its segment of the project with construction on the Malaba-Kampala section expected to commence in September 2024.President Museveni expressed his satisfaction with the progress, highlighting the historical significance of the project for regional integration."My only resolution is to put it in a historical perspective as to why it's happening now and not long ago. Uganda is part of Kenya, Tanzania and DRC," President Museveni remarked.In a separate but related development, Murkomen emphasized Kenya's unwavering commitment to the SGR's extension beyond Uganda. During a meeting with a delegation from China led by the National Railway Administrator, Mr. Fei Dongbin, Murkomen discussed broader railway development initiatives across East Africa and the continent."We discussed variou...
$3.19 Billion Uganda Standard Gauge Railway Project Attracts US ...
Uganda Standard Gauge Railway Project is gaining renewed momentum as the United States emerges as the preferred financing partner for the $3.19 billion rail development. The project, linking Kampala to Malaba, is now advancing under a revised funding strategy after prolonged delays tied to unsuccessful Chinese financing efforts, positioning it as a pivotal East African infrastructure corridor. Uganda Standard Gauge Railway Project financing shift gains traction Uganda has appointed Citibank to mobilize financing for the railway, signaling a decisive pivot toward US-backed funding mechanisms. Moreover, government officials confirmed ongoing discussions with the World Bank to support the project’s financial close. Previously, China had been expected to finance the railway under earlier agreements. However, those efforts stalled for years without firm commitments. As a result, Uganda terminated its contract with a Chinese contractor and restructured procurement and financing frameworks. Consequently, the financing shift reflects broader changes in global infrastructure funding, especially as China reduces lending exposure across Africa. At the same time, the US-backed approach prioritizes syndicated loans, export credit financing, and multilateral partnerships. Uganda Standard Gauge Railway Project construction and scope The Uganda Standard Gauge Railway Project covers approximately 272 kilometers between Kampala and Malaba on the Kenyan border. Importantly, the line will connect Uganda to Kenya’s railway network and ultimately to the Port of Mombasa. This connection will significantly reduce logistics costs for imports and exports in the landlocked country. Furthermore, the railway aims to shift freight transport from road to rail, easing congestion and lowering maintenance costs. In 2024, Uganda awarded the engineering, procurement, and construction contract to Turkish firm Yapi Merkezi. Since then, preliminary works have started using limited government funding. However, full-scale construction remains dependent on securing complete project financing. Uganda Standard Gauge Railway Project regional impact and outlook The Uganda Standard Gauge Railway Project plays a critical role in East Africa’s regional integration agenda. Notably, it forms part of a larger network linking Kenya, Uganda, and potentially the Democratic Republic of Congo. Therefore, the project is expected to boost intra-African trade and strengthen supply chains across the region. Addition...
Uganda rail financing shifts to US after China exit | MEXC News
Shift from Chinese Delays to Western Lenders Uganda awarded the SGR contract to China Harbour Engineering Company (CHEC) in 2015. It required Chinese government financing. Delays mounted. The government cancelled the deal in January 2023. A new path emerged. Uganda signed a construction contract with Turkish firm Yapi Merkezi in October 2024. The line runs 272km from Kampala to Malaba on the ...
Kenya's Sh648 billion SGR extension to Malaba slated to break ground in ...
Kenya is preparing to extend its Standard Gauge Railway (SGR) network through a major 475-kilometre expansion from Naivasha to Malaba via Kisumu, with construction scheduled to kick off in 2025.
