28 June 2014

Ethiopia: Govt Fails to Secure Loans for Three Railway Projects

The Ethiopian government has failed to secure financing for three major railway projects incorporated in the five-year Growth and Transformation Plan (GTP). Work on the three projects were supposed to commence in 2013-2014 fiscal year. Presenting a ten-month performance report on Tuesday to the House of Peoples' Representatives, the Minister of Transport, Workneh Gebeyehu, said that the Ethiopian Railway Corporation was not able to embark on the construction of Awash-Woldiya (Hara Gebeya), Woldiya (Hara Gebya)-Mekelle and Woldiya (Hara Gebya)-Tajura railway projects.

According to Workneh, contact was prepared for the three railway projects and it was planned that financing would be secured and work on the project would commenc in the current year. The minister said the financing could not be secured adding that work on the projects did not commence due to the dearth of financial resource. The minister, however, said that the government had been exerting efforts to secure financing for the stated projects. According to him the government was trying to secure loans from the Turkish government and the Swiss Bank. He expressed his hope that loans would be secured from both parties.

Speaking of the ongoing railway projects, Workneh said there was a mid-level accomplishment. According to him, 40 percent of the Addis Ababa-Meiso-Dewele railway line is completed. He also claims that 71 percent of the Addis Ababa light railway line project is finalized. However, sources close to the project reject the performance repot presented by the minister. These sources said that only 40 percent of the work on the Addis Ababa light railway project was done so far.

Regarding the road construction projects, Workneh said low performance rates were registered. Members of parliament asked the reason for the low performance registered in the road development sector. The minister said poor performance of the contractors and problems related to right of way were the major factors contributing to the low performance.


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