The Independent Uganda: You get the Truth we Pay the Price
CONFIRMED: Uganda writes to Chinese firm to cancel $2.2bn SGR railway line building contract, turns eyes to Turks
Kampala, Uganda | THE INDEPENDENT | Government has written to the China Harbour Engineering Company (CHEC) seeking to cancel an eight year old $2.2bn Standard Gauge Railway (SGR) contract. According to a high level source in government, the Chinese have received the request, but have not yet responded.
The source says that as soon as they get a positive response from CHEC, a team of Ugandan engineers will fly out immediately to Turkey to do due diligence and sign a contract with Yapı Merkezi company.
To show that there has been a change in strategy, the source revealed that the Uganda government already has in place a memorandum of understanding (MOU) with Yapı Merkezi, even though the cancellation of the CHEC contract could come with huge costs.
Yapı Merkezi from Turkey in partnership with Mota Engil Africa from Portugal have just completed phase 1 of the new Dar es salaam – Morogoro (300 km) line. Construction was inaugurated on 12th April 2017, was completed in April 2022, and the railway is currently in the testing phase.
According to The East African, the SGR Project Coordinator Eng Perez Wamburu confirmed they have signed a memorandum of understanding (MoU) with Turkish firm Yapi Merkezi. The company is expected to submit a response to the government’s request for a construction proposal within the next few weeks, paving the way for procurement.
Disapointment with CHEC is a result of eight years of non-execution. The Chinese company signed in 2015 a contract to build the country’s first phase of standard gauge railway (SGR), a 273km line from Malaba to Kampala
According to The East African, the line, starting from the Malaba border post was to have cost $2.2 billion, but the Chinese financiers Exim Bank did not fund the project after casting doubt on Kenya’s SGR reaching the border to link with Uganda’s and making the project viable.
Frustrated by the lack of progress with China Exim Bank, President Yoweri Museveni last year directed his officials to open up the financing of the SGR to the world’s financial capitals, with London and UKEF as the first call in September 2021, sources familiar with the project said.
“From the time of our last financing submission in February 2021, we have heard only silence. After submission, we waited for a few months, it was silence, and up to now, it’s still silent from Exim Bank,” Eng Perez Wamburu told The East African.
RELATED STORY
