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Opinion

A Look at Kenya’s Most Expensive Infrastructure: The Standard Gauge Railway

BY Soko Directory Team · May 11, 2019 07:05 am

The dust settled on the fancy and baroque around SGR travels in Kenya. At the introduction, social media was awash with photos and creative narratives, equivalent to the debuts for many and a premier experience on Kenyan soil for a few who have enjoyed such elsewhere.

Away from the hilarious scenarios of passengers grappling with uncharted waters of using escalators and self-service touch points, sits Kenya’s most expensive infrastructure project since independence, at a cost of US$3.6 billion.

Train transport has gained traction as the leading mode of movement across the world. Across Europe, it is no longer important to have a personal car with the increased reliability of rail transport. TGV, Eurail, and Rail Europe are common names that would give one comfort to work in one city and reside in another. It is so reliable to the minute, that one would rarely miss an appointment. It is also possible to live in France and work in Luxembourg.

Last year, the National Transport and Safety Authority documented 2,917 road users that lost their lives in Kenya. Road carnage has been a thorny issue in this country over the years despite continuous awareness and improved regulatory frameworks. Train transport could significantly reduce these incidents. Trucks transporting goods not only contribute to road accidents but also have a financial implication through the tear and wear.

In Africa, a number of countries have rolled out rail transport system. In 2018, Morocco inaugurated Africa’s fastest train to serve the commercial and industrial hubs of Casablanca and Tangier. The train speed estimated at 320 km per hour reduced the 200 km Casablanca-Tangier journey to around two hours.

A lot of people who went to South Africa’s World Cup meet in 2010 praised the ease of movement occasioned by the railway system. A host of African countries are considering investment in this mode of transport for its citizen and goods. Consider for the example the distance between Dar Es Salaam and Mwanza in Tanzania. It takes 18.5 hours to travel by road and cover 1,145 kilometers. Since everyone may not afford flights between such distances, infrastructure investment in a railway system could solve the issues of movement.

In Kenya, there has been a sustained opposition to further investment in the SGR especially due to the associated debt burden. While this is an obvious consideration, it is also important to consider the viability of such a project. Kenya’s standard gauge railway will be financially viable if it combines the transport of passengers and goods. Further, a collaboration between East African countries especially Uganda to link Mombasa and Kampala will spur immediate economic value. The recent discussions between China and Kenya to finance SGR from Naivasha to Kisumu may not have borne fruit but are important to make this infrastructure meaningful.

Therefore, an investment in the magnitude of Kenya’s SGR might look enormous for now but it’s definitely a step in the right direction. The fact that now it is possible to transit between Nairobi and Mombasa in under five hours in extremely favorable conditions and the cost is promising.

Soko Directory is a Financial and Markets digital portal that tracks brands, listed firms on the NSE, SMEs and trend setters in the markets eco-system.Find us on Facebook: facebook.com/SokoDirectory and on Twitter: twitter.com/SokoDirectory

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