Uganda has signed a $3 billion (about Sh10.8 trillion) contract with Turkish construction company Yapı Merkezi to build a 272-kilometre railway to boost regional trade and business integration.
The agreement, which is the flagship of the Northern Corridor Integration Project (NCIP), was signed in Kampala by the Permanent Secretary in the Ministry of Public Works and Transport, Mr Waiswa Bageya, and the Vice Chairman of Yapı Merkezi Holdings, Erdem Arıoğlu.
The SGR will run from the Kenyan border in Malaba to Kampala, Uganda, connecting Kenya’s rail line to the port of Mombasa.
The new system is designed to move goods faster and more efficiently than the current meter rail system.
The project is part of a larger plan for a 1,700 km electrified railway to improve economic connectivity while reducing transportation costs.
“We are pushing to improve the structure of the economy. The SGR is one of those projects that feed into this agenda,” Uganda’s Minister of Works and Transport, Edward Wamala said.
He added that Kenyan neighbours are still working hard to establish the Naivasha-Kisumu-Malaba link. We are confident that the extension of the Naivasha-Malaba link agreed with the Kenyan border will be met.
Uganda’s Standard Gauge Railway (SGR) project manager Conon Perez Wamburu said the deal was the first part of a 1,700-kilometre electrified railway plan that will cost 2.7 billion euros.
“Construction is set to begin in November and will take 48 months to complete,” Conon Wamburu said.
The Turkish deal came after nearly nine years of delays on the initial contract signed by China Harbour Engineering Company, which received funding from the Chinese government. Uganda withdrew from the deal in 2023 after years of fruitless negotiations.
At the signing, Uganda said it would use its development capital and external loans planned in the country’s budget (about $600 million in external loans for the project).
The first section of Kenya’s Standard Gauge Railway, which connects Nairobi to Mombasa and operates for freight and passenger trains, was completed in the second half of 2017.
In 2013, Kenya, Uganda, South Sudan, Tanzania and Rwanda signed an agreement to build a railway line to boost regional trade. Ten years later, only Kenya and Tanzania have taken action.
