Summary:

• Uganda’s efforts to upgrade its meter-gauge railway on the Northern Corridor are in the final stages. Despite equipment shortages, a section has been completed, with the goal of reducing transportation costs and boosting trade competitiveness.

Uganda is in the final stages of its planned renovation of the meter-gauge railway to reduce transportation costs on the Northern Corridor and enhance trade competitiveness. Despite facing equipment shortages, The EastAfrican reports that Spanish firm Imathia Construction has completed the replacement of steel sleepers with concrete beams on the Namanve-Kampala section, with the handover expected this month. According to John Lenon Sengendo, the publicist for Uganda Railways Corporation (URC), the final section from Namanve to Mukono will follow.

This marks the second completed section after the rehabilitation of the Tororo-Namanve line, including the line to Jinja Pier, a year ago. Despite the improved condition of the Malaba-Namanve meter-gauge track, concerns persist among importers, exporters, and shippers due to a shortage of rolling stock and operational inefficiencies. Currently, 90 percent of traffic on the Northern Corridor is transported by road, with only about seven percent utilizing rail, primarily due to the suboptimal state of rail infrastructure.

Transport costs on the Northern Corridor remain comparatively high, ranging from 20 to 25 cents per tonne per kilometer for road transport, while rail transport costs range from 6 to 12 US cents per tonne per kilometer, depending on the cargo type.

The shortage of rolling stock is attributed in part to URC, with a discrepancy noted in their asset register. The Auditor General’s report from June 2022 revealed that out of 521 wagons located in various parts of Kenya, only 128 were accounted for, raising concerns about potential overstatement of URC’s asset values.

To address these challenges, Uganda plans to purchase 3,000 horsepower locomotives by 2026, and the government-owned wagon ferries are expected to increase from two to four. The African Development Bank will provide $233.2 million, and the African Development Fund will contribute $100.7 million as concessional loans to finance construction and rolling stock acquisition.

URC aims to shift cargo from road to rail, targeting a transportation volume of six million tonnes per year. Additionally, Uganda is revitalizing the meter-gauge railway route from Tororo to Gulu City in the north, with ongoing construction of the Gulu Logistics Hub, strategically positioned to connect with the markets of Congo and South Sudan. Phase one of the hub, which includes rail links, is projected to be completed by March 2022.