Failure to pay land compensations blocking Uganda’s standard gauge railway
Kampala, Uganda (PANA) - Uganda’s push to build a standard gauge railway line and upgrade its dilapidated normal gauge railway is making very slowly because the government has a sizeable land compensation bill to first pick before it secures credit for the construction, a minister has said.
The government needs to pay out US$20 million to compensate the people occupying the identified railway corridor from the eastern border town of Malaba to the capital, Kampala, a distance of 220kms. Clearing the compensations is one of the conditions for the financing, Parliament was told.
“The Exim Bank [of China] has insisted that they will not give us money if we have not got the entire right of way,” Aggrey Bagiire, the state minister for transport, told parliament earlier on Wednesday.
Uganda hopes to borrow US$2.17 billion for the railway project to build this particular stretch of rail, dubbed the eastern route, before it potentially embarks on the western route to connect to the Democratic Republic of Congo and Rwanda.
Being a landlocked country, a big bulk of Uganda’s imports come via the Kenyan port of Mombasa, through Kenya to Malaba and on to Kampala and other areas. It is because of the importance of the route that regional countries have been pushing for the upgrading of the railway to standard gauge.
Kenya moved ahead of Uganda and built the stretch from Mombasa to Nairobi, but it has also not extended the rail line from Nairobi to its western border with Uganda at Malaba, from where Uganda is supported to push it farther to Kampala and potentially all the way to its western border.
The lack of money to compensate people living in the railway corridor has now been highlighted by the minister as the stumbling block, but before it there have been other problems.
One reason that has been highlighted for the delay of the proposed project is that Exim Bank of China, which is owned by the government of China, is dragging its feet over releasing the money to Uganda, which already owes China about US$6 billion.
For instance, Chinese money has in the recent past helped build the 183MW Isimba hydropower dam that was launched recently, and is also being used to build a bigger power dam at Karuma, also on the Nile River, with an installed capacity of 600MW.
China also financed the construction of the standard gauge railway in Kenya.
-0- PANA EM/VAO 17April2019
