A standard gauge railway (SGR) project that would have connected Kampala with Uganda’s Malaba border post with Kenya out west has been scrapped after eight years of back-and-forth behind-the-scenes wrangling.
The project for the 273-kilometre line was awarded to China Harbour Engineering Company (CHEC), but last November it finally emerged that the government of Xi Jinping wasn’t willing to finance the project.
Primarily, enthusiasm for the project waned because China Exim Bank (CEB) had lost interest in providing the necessary funding.
One explanation that has been offered for the bank’s change of heart is the impact that the coronavirus pandemic has had on China’s economy.
Although the CEB has been Uganda’s investor in principle over the last decade, ensuring that infrastructural expansion projects get off the ground, the bank has been slow to respond to inquiries from Kampala, a coordinator for Uganda’s SGR projects has said.
Perez Wamburu said Uganda had drawn its own conclusions when China’s ambassador, Zheng ZhuQiiant, recently said that his country had lost its appetite for big-spend ventures in Africa.
In the interim, it has emerged that Yapi Merkezi, a Turkish firm already busy with SGR work on Uganda’s expanding railways network, has stepped into the breach.
Wamburu said although they were patiently waiting to hear from CEB, the last time they had heard from the bank was in February 2021.
It is believed that Uganda is now exploring a different funding model for the $2.2 billion the country would have received from the CEB for the project.
