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Kenya signs Sh314 billion Railway deal with China

Sunday, May 11, 2014 - 00:00 -- BY JOSEPH KARIUKI
President Uhuru Kenyatta and Premier of the State Council of the People's Republic of China, Li Keqiang make a toast to the cordial relationship between the two countries during a State Banquet hosted in his honour at State House, Nairobi.Photo/PSCU
President Uhuru Kenyatta and Premier of the State Council of the People's Republic of China, Li Keqiang make a toast to the cordial relationship between the two countries during a State Banquet hosted in his honour at State House, Nairobi.Photo/PSCU

Kenya has today signed a Sh314.2 billion Mombasa-Nairobi railway deal with China at State House in Nairobi.

The first phase of the standard gauge railway project will cover 609.3 kilometers from the port of Mombasa to Nairobi and will cost $3.6 billion (Sh314.2 billion). 90 per cent of the financing will come from China Exim Bank while the remaining 10 per cent will be foot by Kenya,State House said in a statement.

During the signing ceremony that was witnessed by EAC presidents Yoweri Museveni of Uganda, Paul Kagame of Rwanda and Salva Kiir of South Sudan, Uhuru likened the sealing of the deal as a break from colonialism.

"The Kenya-Uganda Railway was built by a colonial power that sought to dominate East Africa’s coast and interior. This is not mere conjecture, but the admission of the builders themselves: they had seized a colony, they had to hold it and make it pay for its own domination. And so the Lunatic Express, as it was later to become known, took shape," said Uhuru.

Uhuru said the signing of the deal will connect Kenya and the region and open up trade.

"We gather today to observe the signing of agreements for the new standard gauge railway whose construction will connect one end of Kenya to another, and eventually unify all of East Africa, from the ocean to the mountains of the interior.

The costs of moving our people and our goods within across our borders will fall sharply; the better to hasten the East African integration to which we are all committed,"Uhuru said.

The Standard Gauge Railway is aimed at providing efficient and cost effective rail transport for both freight and passengers. It is intended to reduce the cost of doing business by reducing the cost of transport, a move that will see Kenya become a competitive business hub for the East African region and beyond.

Passenger trains will have a speed of 120 kilometers per hour while those for freight will be designed to move at 80 kilometers an hour.

"It will take passengers four hours and 30 minutes to travel from Mombasa to Nairobi while freight will take eight hours. The project is slated to kick off on October 1st and take 42 months to complete," Uhuru said in a statement.

The signing ceremony was the climax of the Chinese Premier Li Keqiang three-day State Visit to Kenya, which ends today

Kenya has signed 17 deals since Chinese Prime Minister Li Keqiang landed at JKIA on Friday evening. Other deals include setting up of a sh170billion China Africa Development Bank, sh5.1billion China Africa research Centre and 880M wildlife fund.

Kenya can now set her sight on the Standard Gauge Railway after parliament gave the project a clean bill of health.