RVR plans Kenya-Juba-Cairo route

By MUGAMBI MUTEGI, pmutegi@ke.nationmedia.com

February 17  2014 

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Cargo will move from Mombasa port to Juba via rail, and from South Sudan to Cairo through the Nile River where RVR’s majority shareholder runs a shipping business called Nile Logistics.The Nairobi to Cairo route via Sudan is shorter than the sea route. It is also faster given that trains move faster than ships.

Rift Valley Railways (RVR) is looking to create a seamless connection between Mombasa and Cairo through Sudan, offering transporters a direct route linking east and North Africa.

Cargo will move from Mombasa port to Juba via rail, and from South Sudan to Cairo through the Nile River where RVR’s majority shareholder runs a shipping business called Nile Logistics.

Citadel Capital, the Egyptian private equity fund that owns 51 per cent of RVR, revealed the plan in a December brief to investors without giving details such as time frame and costs.

In September, RVR rehabilitated 500km of the railway line linking Kampala to northern Uganda which it plans to connect to Juba from where Nile Logistics operates a shipping line with 45 vessels.

“Once the first leg has been established, additional railway links can be added to create a cross-continent transportation and logistics network,” said Citadel Capital in the investors brief.

Currently, the bulk of cargo from Egypt to Kenya and neighbouring land-locked countries is hauled through the Indian Ocean to of Mombasa port.

RVR is looking to tap the flow of trade running from Egypt, Sudan, South Sudan, Uganda, and the great lakes to DR Congo. The Nairobi to Cairo route via Sudan is shorter than the sea route. It is also faster given that trains move faster than ships.

Tea has for the past decade accounted for 90 per cent of Kenya’s exports to Egypt. In 2012 this figure rose to 96 per cent of the Sh21.4 billion exported to the country.

Kenya also exports spices, tobacco, textiles, dairy products, soda ash and aluminium, among other products, to the north African nation.

Kenyan imports from Egypt stood at Sh29.8 billion in the same year and included products such as rice, sugar, and fish.

RVR’s quest for another trade route comes as Kenya in November launched he construction of a new railway between Mombasa and Nairobi which will eventually link the Indian Ocean port city with Uganda, Tanzania and Rwanda.

The new line will ferry heavier and bigger containers faster and will relieve pressure on the region’s roads, which have been damaged by heavy traffic, officials said.

Spending billions

Years of mismanagement in Kenya and Uganda meant that their governments neglected proper maintenance of railways. As a result, much of the freight destined for Kenya’s landlocked neighbours is transported by road.

But RVR is spending billions of shillings to revamp the Kenya–Uganda rail and increase the share of cargo it handles to 12 per cent in 2015 from the current 7.3 per cent.

“Over the coming two years the company will be adding approximately one locomotive and 50 wagons per month via rehabilitation,” said Citadel.

Businessdaily. Com


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