The Reporter (Addis Ababa)

15 February 2014

Ethiopia: Russian Company Tracks Ethiopian Railway Sector

The state-owned Russian Railway Company is in discussions with the government regarding potential opportunities to engage in railway development projects. On Wednesday the Russian delegation, led by Russian Railway vice president Alexandor V. Saltanov, held talks with the Foreign State Minister Dawano Kedir in Addis Ababa. "We are in the process of contact with our Ethiopian partners and friends about the prospect of Russian-Ethiopian cooperation in the construction of the railway infrastructure in this country," MoFA spokesperson Ambassador Dina Mufti told journalists.

"We agreed to continue meetings and exchange of views, and even jointly study all the details of the implementation of such a great project," Dina said, adding, "Ethiopia seeks the engagement of the Russian business community in investment and different economic sectors.

"It is important to work with the Russian Railway Company because of its experience, to facilitate knowledge and technology transfer." The company vice president also met with Prime Minister Hailemariam Desalegn and Ethiopian Railway Corporation officials on ways to participate in railway development projects.

The government has been looking to finance more than 2000 km of railway, as set out in its Growth and Transformation Plan (GTP). Construction on the mega railway project in Ethiopia has been going on for some time now, with one of the major aims to create a substantial infrastructure link between Addis Ababa to Djibouti.

The Addis Ababa-Djibouti double-track railway project is one of the eight routes that the Ethiopian government is planning to build over the GTP period, in order to increase trade and economic relations with its neighbors.

The Corporation has been involved in a series of negotiations with Brazilian and Russian companies to launch new railways projects in addition to those already underway.

In January 2010 it was announced that the Ethiopian government had signed a memorandum of understanding with four companies to build a new rail network. Among these firms were China Communications Construction, China Railway Engineering Group (CREC), and an Indian and Russian company. Only the Chinese firms pursued further action, so the contract was awarded to CREC. In August the Export and Import Bank of China agreed to fund the project and in September 2010 construction began.

The network will stretch 5,000 km long and radiate from Addis Ababa. It will be constructed in two phases, with the first phase involving the construction of five lines. The project will provide 300,000 construction jobs and cost USD 336 million annually for five years, while the system will handle six million tons of freight. The government of India has given USD 300 million for the Mekelle-Djibouti rail line.

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