3 December 2012

East Africa: Regional Rail Project to Cost Over U.S.$5 Billion

The East African Community railway line that will connect Rwanda- Tanzania and Burundi project would cost about $5.2 billion, according to a Canadian consultancy firm, Canarail, which was hired to conduct a feasibility study.

The firm announced this last Friday in Kigali during a consultative workshop, where the firm presented the results for the Dar es Salaam-Isaka-Kigali/Keza-Gitega-Musongoti railway projects.

While presenting the findings, ,Donald Gillstrom, the senior vice president and chief engineer at Canarail said the final study will be completed next year.

"The final study will be complete in February and the remaining big challenge will be for the governments to solicit funds for the construction to commence," he told The New Times in an interview.

According to the consultant, if the funds are obtained the project would take four years to complete.

Once completed, the long awaited project is expected to lower the country's transport costs which increases the cost of doing business due to high transportation costs of goods from both ports of Mombasa, Kenya and Dar es Salaam, Tanzania.

The time it takes to transport cargo from Dar es Salaam will be reduced to only two days to Kigali by rail compared to the current three to four days by road.

Apart from connecting the landlocked countries to the sea and lowering the costs of importation, the project is also expected to ease the deterioration of the regional road network.

State Minister in charge of transport at the Ministry of Infrastructure, Dr. Alex Nzahabwanimana described the project as key to the country's economic development as well as other partner states.

"There is no other way for Rwanda to cut the price for the goods without this project. Air transport has its limitations especially the high transportation costs and the railway line would be more favorable to traders," minister said.

It is estimated that a freight train could carry between 6,000 to 7,000 tonnes of goods from the Dar port whereas a passenger train has a capacity to transport over 800 people from Tanzania to Rwanda.

The passenger ticket from Kigali to Dar es Salaam would cost about Rwf16,000 ($26) compared to Rwf 25000 by road.

Nzahabwanimana said that early next year, ministers from the three countries will meet to discuss administrative matters about the running of the project, including the permanent location of the railway line.

The issue of poor infrastructure is regarded as a hindrance especially towards the integration process iin the region. During a recent retreat of the EAC Heads of State in Nairobi, Kenya, the leaders directed the Council of Ministers to develop an investment strategy with clear financing options and timeframes for priority projects with an effective monitoring and evaluation mechanism to ensure that projects are effectively implemented and managed.

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