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BUSINESS & TECH

Chinese-Built Railroad Speeds Growth in East Africa Region

By Song Shiqing
The Mombasa to Nairobi railway opens on May 31. The 480-kilometer, Chinese-built railway could reshape East Africa’s economy. Photo: IC
The Mombasa to Nairobi railway opens on May 31. The 480-kilometer, Chinese-built railway could reshape East Africa’s economy. Photo: IC

(Beijing) — A 480-kilometer, Chinese-built railway that could reshape East Africa's economy by linking Kenya’s port of Mombasa to its capital Nairobi has officially opened.

The project to build the $3.8 billion railway, dubbed the Madaraka Express, was Kenya’s largest infrastructure initiative in more than 40 years. And the completed line is being touted as a major success for the Belt and Road, Chinese President Xi Jinping’s ambitious infrastructure and trade program connecting China with Europe, Southeast Asia and Africa.

Speaking at an inauguration ceremony Wednesday, Kenyan President Uhuru Kenyatta said the new railroad will “reshape the story of Kenya” by replacing tracks British colonialists built 120 years ago.

Trains riding the decaying Uganda Railway between Mombasa and Nairobi have been notoriously slow and shaky. The railway’s freight service is considered inefficient and so out of step with the region’s developing economy that large amounts of cargo must be moved on Kenya’s congested roads.

Rail cargo volumes have been falling in recent years even as Mombasa’s port cargo volume has exploded, reaching 27 million metric tons in 2016. Projections call for capacity to rise to 44 million metric tons by 2025, according to the port’s operator.

The Madaraka Express is designed to handle up to 22 million metric tons of freight every year and will help freight handlers overcome capacity constraints at Mombasa’s port, according to China Communications Construction Co. (CCCC), the parent of railway builder China Road and Bridge Corp. The port is the biggest and most important gateway for the six countries that make up the East African Community.

The railway is slated to expand and eventually connect Mombasa to landlocked South Sudan, the Democratic Republic of Congo and Rwanda.

And the new line is fast, having shortened the Mombasa-Nairobi ride to four and a half hours. A trip on the old line could take more than a day.

An Export-Import Bank of China loan to the Kenyan government covered 90% of the project’s cost, while the government is paying the rest.

He Wenping, chief researcher at the Institute of West-Asian and African Studies at the Chinese Academy of Social Sciences, sees no obstacles to timely loan repayments given Mombasa port’s financial strength and trade growth.

The railway “benefits both Kenya and China,” He said. “The potential risk of a delayed payment should be non-existent, as the capacity of the Mombasa port is strong and growing.”

The construction project created 46,000 jobs and is estimated to add 1.5% to Kenya’s gross domestic product growth, according to CCCC.

The railway is also expected to benefit Kenya’s tourism sector, since trains roll through scenic areas including the Mount Kilimanjaro region and two national parks. Domestic tourism revenue was expected to double over the next year, Kenya’s cabinet secretary for tourism, Najib Balala, told China’s official Xinhua News Agency on Thursday.

And a passenger ride on the new line costs considerably less than bus fare.

The railroad has been criticized by wildlife activists who say it interferes with animal migration. The organization Save the Elephants said at least 10 elephants have been killed by trains since construction began in May 2014.

However, He dismissed the migration complaints as “total nonsense,” noting that “when I visited the construction site, I saw a number of bridges and culverts that had been built to allow animal movement.”

Besides, He argued, “animal interests should not be put ahead of human interests.”

Contact reporter Song Shiqing (shiqingsong@caixin.com)

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