African Development Bank approves loan for rail project

Date: 18/7/2011

In an effort to improve transport infrastructure, the African Development Bank (AfDB) has approved a loan for a train project in the eastern part of the continent.

AfDB has approved a $40 million (£24.8 million) loan to go towards financing the Rift Valley Railways initiative.

The scheme will result in a network that runs from Mombasa in Kenya to Uganda's capital Kampala. It is expected the capital investment programme will last five years and cost $246 million in total.

It is estimated that within this region rail is used to transport eight per cent of goods, while 92 per cent is moved by road vehicles.

By transferring some of this freight to trains, the burden on the region's roads would be reduced while this would also be a significant boost for the region's infrastructure, as the current railway is more than a century old.

By 2015, it is estimated that the amount of goods moved on rail transport will have doubled to 3.3 million tonnes each year.

In line with this, marginal costs are expected to drop by as much as 30 per cent.

Last month, the AfDB approved a grant of $67.23 million for the second phase of a road project in Burundi, which will include asphalting, bridge construction and general repairs.

Posted by Mary Treen