Naivasha-Malaba rail upgrade Fiasco

The government has opted to fund the renewal of the Metre Gauge Railway (MGR) line to Malaba with an initial budget of Sh3.5 billion thus dropping an expensive Chinese contractor for the upgrade of the old railway track from Naivasha to Malaba to link the century-old line to the standard gauge railway (SGR) line at Naivasha.

In the same breath, it has dropped a private financier and the use of the Chinese contractor who had quoted in excess of Sh50 billion to upgrade the line and link it to the Mombasa-Naivasha SGR line.
Funding from an unidentified private backer was seen as a cheaper option compared to building a new modern line with Chinese loans, but the upgrade costs derailed the project.

In an interview on Tuesday, Transport CS James Macharia is recorded saying that Public Private Partnership (PPP) arrangement was taking too long, prompting the government to drop it and seek a cheaper financing model.

Government will fund it and the estimated cost is about Sh3.5 billion, but after proper documentation this could be plus or minus,” Mr Macharia said. “I would say that about a month from today, it will start and will take a year to complete. We want to do it as an extension of the SGR and it has to be seamless”.

Sources familiar with the earlier PPP plan which was to begin action last year 2019 July said that a quotation for the upgrade by the Chinese contractor had surpassed the envisaged budget by more than three times, sending the government back to the drawing board. And based on Chinese quotation, the private contractor was going to charge tremendous sum of money to recover their investments.