After months of sourcing for additional money for the extension of Standard Gauge Railway from Naivasha to Kisumu, President Uhuru Kenyatta has after all dropped the plans.
Initially, Uhuru had approached China for additional Sh368 million for Phase 2B of the SGR, which was supposed to reach the lakeside city of Kisumu.
However, the Chinese government reportedly withdrew from the plans, due to Kenya's rising debts which now stands at Sh6 trillion.
The Chinese “are adopting a more cautious approach to their debt exposure in Africa,” said Piers Dawson, a consultant at London-based investment consultancy Africa Matters Ltd. He cites “increased noise around its sustainability and potential default.”
As a temporary solution before securing any loan for extension of SGR, the government has now opted to revive the old Nakuru-Kisumu Meter Gauge Line which has been out of service.
Transport CS James Macharia on Wednesday said that the Kisumu line, which had a thriving passenger service in the 1990s, will form the major supply route to deliver cargo to the neighbouring countries through the Kisumu port.
"We have just completed a technical assessment of the line and we need about Sh3.8 billion to make it workable though not at a high speed," CS Macharia said in an interview with the Business Daily.
"This will be useful in supplying cargo to the port, which we have completed reviving. It is an interim solution as we plan for the extension of SGR," he added.
This now means the SGR at Naivasha will be connected with the old railway for transportation of cargo to Kisumu Port, which is now complete.
President Uhuru Kenyatta revived the port at Sh3 billion and it's set for launching any time soon. The port will link Kenya to Uganda, Rwanda and DR Congo.
In May this year, opposition leader Raila Odinga had hinted that he was going to China with Uhuru to secure loan for Naivasha-Kisumu SGR. State House later denied the reports.