Saturday, 5 August 2017

Museveni deals a death blow to Magufuli's dream on SGR

Northern Corridor is Robust compared to central Corridor
 PRESIDENT Yoweri Museveni has approved the borrowing of $2.9 billion for the construction of the standard gauge railway from the Malaba border with Kenya to Kampala. This deals a death blow to Tanzania’s dream of diverting Uganda’s Railway line south to the Central corridor.

President Museveni authorized the loan on condition that concerns over the technical specifications and project costs raised by the Parliamentary Committee on Infrastructure in February would be addressed.
The parliamentary committee had demanded a complete review of the Uganda-Kenya Standard Gauge Railway Project. It was comparing the project’s costs with the Ethiopian SGR project which cost an estimated US$ 5 million per kilometre. The Malaba- Kampala line will cost an estimated $7.2 million per kilometre.

However, a technical paper, by the Uganda Ministry of Works and Transport ably answered such questions. It argues that the highest cost is in bridges, followed by the earthworks (embankment), followed by track, stations electrification and signaling among others.

For example, the paper argues, on Malaba- Kampala  line, bridges will absorb 35% of the costs, earthworks 25% , the track and station will absorb 10 % of the costs each, while  electrification and signaling will absorb 5% of the costs each and 10% others.

The Ugandan line, the paper argues, will pass through 53 kilometers of swamps meaning the embankments or mounds of stone or concrete have to be built to carry the line across. The line will have an estimated 29.74 kilometres of bridges including a one kilometre bridge across the river Nile, it says. The Ethiopian line on the other hand, has only one 150 metre bridge in the whole stretch. Even the Tanzanian line will have fewer bridges of the same magnitude.
Bridges form the largest Costs centre absorbing 35% of costs

The Paper demonstrates that the Naivasha- Kisumu section of the Kenyan SGR will cost an estimated US$13 million per Kilometer because of the many super bridges to be construction on this section which traverses the rugged Rift valley.

The document, seen by this publication also defines the key factors in the decision to invest in a modern railway line.  
Top on the agenda is savings in transit time, robustness, reliability, and maintenance costs in that order.
The paper, an analysis of the SGR projects in East Africa, demonstrates why the central Corridor is not an option for Uganda. It demonstrates that the Central line is three days slower than the Northern Corridor even if they are built of the same standard. Dar-Es-Salaam port is 1548 Km away from Kampala compared to Mombasa port, which is 1250 km away.

Of the 1548 Km, 1228Km are on land and 320Km are on water- across Lake Victoria. This in itself calls for investment in sea-going vessels and improvement of the Ports in both Mwanza in Tanzania and Port bell in Uganda.

Even with these investments, the document demonstrates, the Tanzanian route in not an option for Uganda whose ambition is to be a middle income country with a GDP per capita of $9500 a year by 2040.
 To get there, Uganda needs to attract investment into heavy industry producing “for high-end markets in Europe, North America, Asia and other developed countries.” Consequently it needs fast, reliable, robust and efficient transport system.
Embankments are the second costs centre absorbing 25%
 In terms of robustness of the line, the paper demonstrates that the Northern corridor SGR, which is Class One Chinese standard, has a capacity of transporting more than 8000 containers per day in 40 trains each carrying 216 containers. The Tanzania route on the other hand, is restricted to 216 containers due to vessel restrictions.

 It will take 5 ferries to carry the 216 containers on the 320 km trip across Lake Victoria. Each ferry has a capacity of 44 containers. To off load and load and transport the 216 containers across the Lake will take an additional 15 hours, says the paper.

This will raise the total transit time on the Tanzanian route to more than 72 hours. And, the report adds a caveat, “that is being optimistic.”  To the contrary, the Kenyan route will take 24 hours to transport freight from Mombasa to Kampala, it says.

Comparing the Ports capacity, the paper says that the Mombasa port is three times bigger than the Port of Dar-Es-salaam. The paper, though, was published before Tanzania inked the deal to expand the Dar- port.

The paper says that the central corridor is not popular with Ugandans who transport only 0.5 million tons of freight per year compared to the Northern Corridor which ships more than 10 million tones a freight a year.

In terms of reliability, the paper tears apart the Tanzanian and Ethiopian lines. Both are low quality compared to the Northern Corridor SGR. The Ethiopian line is Class 2 Chinese standard while Tanzania opted for AREMA (American Railways Maintenance Association) standard. Both are designed to carry a maximum of 20 million tons a year. The Northern corridor -which traverses Kenya-is designed to ship up to 35 million tons a year.

 The implication here, says the paper, is that should demand for railway services rise in both Tanzania and Ethiopia, they will have to build additional lines to meet demand.  The Northern Corridor line, is sufficiently robust to accommodate future demand increases.

The paper advises that for projects designed to last 100 years, the initial sunk capital should not inform the decision to invest. It argues that the life time maintenance cost of a project should inform the decision. In the case of SGR says the paper, the Maintenance cost for the Class one line are lower than the other two