SGR Sold 1.66 Million Tickets in 2018 But Still Running on the Negative

Kenya’s Standard Gauge Railway (SGR) sold slightly above 1.66 million tickets in 2018 bringing in 1.61 billion shillings in revenues.

The number of passengers alone was not enough to maintain the operational costs. Stats show that the SGR requires at least 1 billion shillings to operate every month. This translates to 12 billion shillings annually.

This means that the country used 12 billion shillings in 2018 to operate SGR and out of it got only 1.61 billion shillings in revenues.

To help increase revenues, in 2019, SGR management increased train fares from Mombasa to Nairobi by 100 percent for children.

Passengers who traveled through economy seats paid 1,000 from January 2018 from 700 shillings, a 42.86 percent increase.

Revenue from passenger tickets in the June-December 2018 increased to 1.05 billion shillings from 627.66 million shillings in the same period in 2017.

In 2018, the SGR brought in nearly 10.33 billion shillings in revenue with the freight service bringing in 8.72 billion shillings.

Kenya took more than 320 billion shillings in loans from Exim Bank of China that helped in financing the construction of the mega infrastructure under the Jubilee administration.

Out of the 10.33 billion shillings that SGR brought in as revenue, the government used 36.24 billion shillings towards the servicing of the loan. The loan becomes due in July 2019 where the amount required to be paid will increase by more than two and a half to 82.5 billion shillings.

The loan taken for the SGR that was taken in May 2014 is supposed to be paid in full in 15 years failure to which there is a possibility of Exim Bank of China taking over the Port of Mombasa among other government revenue generators.

According to the Kenya National Bureau of Statistics (KNBS), 5,039,988 tons of freight were ferried using the SGR bringing in 8.72 billion shillings. 1.61 billion shillings came from the sale of tickets bringing total revenue to 10.33 billion shillings, less than the operating cost which stood at 12 billion shillings.