Kenya’s President Uhuru Kenyatta is due to open a new $1.5-billion
Chinese rail line on Wednesday
linking the capital Nairobi to the Rift Valley town of Naivasha, despite delays
in establishing an industrial park
there to drive freight traffic.
The extension links to the $3.2-billion line
between the port of Mombasa and Nairobi
that opened in 2017, also suffering from underutilisation of its cargo services. Both sections
were Chinese-funded and Chinese-built.
The development of Kenya’s railways has been part
of China’s “One Belt, One Road” initiative, a
multi-billion dollar series of infrastructure projects upgrading
land and maritime trade routes between China and Europe, Asia and Africa.
Kenya had planned to open an industrial park in
Naivasha, offering companies tax breaks for investing in manufacturing, and
preferential tariffs for electricity generated in the nearby geothermal fields.
But that has been delayed.
Kenyatta was re-elected for a five-year term in
2017 after promising to develop the East African nation’s infrastructure. The railway
was his pet project but it
has been dogged by problems. In April, China refused to fund the planned
$3.7-billion extension from Nairobi to the Ugandan border town of Malaba.
Transport Minister James Macharia said then
that the government would spend $210-million to rehabilitate the colonial-era
Malaba line instead.
Many importers say the new Mombasa to Nairobi
railway is too expensive to move freight. They have
been angered by government attempts to force them to use it.
It costs about $800 to truck a container from
Mombasa to Nairobi, but $1,100 by rail, mainly due to extra costs
for moving goods from the rail terminus to an inland
depot.
Government borrowing has been ramped up to fund the
railway and other projects such
as roads. Total public debt stands at
about 55% of GDP, up from 42% when Kenyatta took power in 2013.
Last week, parliament raised the government’s debt ceiling to nine-trillion shillings ($86.87-billion) after the government came close to hitting the earlier ceiling of 6 trillion shillings. http://www.engineeringnews.co.za/article/kenya-opens-chinese-built-railway-linking-rift-valley-town-to-nairobi-2019-10-16
