“The nation-building surge witnessed in Kenya during the first 15 years of independence was remarked around the world. It was a mark not only of acceptable national leadership and management but also of Kenyans’ yearning to improve their standards of living …to be masters and architects of their own fate.”
These are excerpts from ‘Reflections on the State of the Nation’ by Mwai Kibaki delivered at the University of Nairobi on December 2, 2013, to mark [email protected]
The former President’s sentiments are no different from the overriding message President Uhuru Kenyatta put across last week regarding the Standard Gauge Railway. Indeed, a lot has been bandied about over the project. However, little is being said about the benefits to the country and the region.
Here is what is not being said.
Other than the obvious benefit of better transport, the project once completed will create jobs and help the country’s and the region’s economies grow. Not only will we transport more goods at a faster rate, but we will also create many opportunities for the youth.
Fact: Statistics show that in 2012, the Port of Mombasa handled 22 million tonnes of freight for the whole Eastern Africa region.
This traffic is projected to grow at 6 percent annually reaching 56 million tonnes by 2030.
This growth will only be realised with the support of an efficient and cost-effective rail transport system to speed up the off-take of freight. Without such infrastructure, the port will continue to be inefficient and grossly affect the economic growth of the country and the region.
The proposed railway will also reduce the cost of doing business in the country and the region. Today, transportation accounts for close to half of the cost of goods and services compared to less than 10 percent recorded in other parts of the world.
Fact: The existing metre gauge railway is underperforming due to poor design, obsolescence, deferred maintenance and prolonged lack of capital investment, which has seen its performance decline to less than 1.0 million tonnes annually. This does not support the freight growth at the Port and meet the expectations of the business community in the country and region.
Even before the project is completed, there are many socio-economic benefits to the country. According to the law, at least 30 percent of the cost of financing will be spent locally to create jobs and spur economic growth.
At least 60 new jobs will be created per kilometre of track during construction period for general labourer’s, drivers, clerks, carpenters, masons, general fitters, welders, electricians, engineers, accountants, environmentalists, and sociologists.
Fact: Kenya is strategically located to be the transport hub in the East African region particularly for those countries using the Indian Ocean seafront for external trade. The Port of Mombasa is linked to the hinterland by the Northern Corridor transport infrastructure, which serves Kenya, Uganda, Northern Tanzania, Rwanda, Burundi, Eastern DR Congo, Ethiopia and South Sudan.
Fact: Most economic activity is centred around Mombasa, Voi, Athi River, Nairobi, Nakuru, Eldoret and Kisumu, which were all created by the building of the existing railway.
A railway, therefore, undoubtedly has capacity to spur growth much more effectively than other modes of transport.
Kenya is bound to lose its competitive edge to neighbouring countries, as a transport hub should it fail to increase rail transport capacity in the Northern Corridor. Tanzania has already embarked on building its own railway to increase its competitiveness with Kenya.
We must therefore protect the port of Mombasa and that of Lamu, once completed from the growing competition from the other regional ports. This will ensure that the country’s economy continues to grow steadily.
Fact: During the construction, there will also be demand for supplies that will also spur growth in local industries. The construction will require local inputs such as steel, cement, aggregates, electricity generation and electricity transmission pylons and cables, roofing material and glass. These will create business opportunities for individuals and SMEs for short and long-term relationships with the railway.
It is estimated that during the construction phase the supply chain has potential to create at least 10,000 jobs. Fact: There is a deficit of skilled labour in the country for precision work in the railway construction and operation. This project gives us opportunity to increase manpower skills that will be essential for other projects are we steer the MV Vision 2030.
The project provides a great investment opportunity for entrepreneurs, as the railway will be operated on the basis of “open access”.
Entrepreneurs are, therefore, provided with an opportunity to purchase their own locomotives and rolling stock to enter the railway transportation business. I rest my case.
(The writer is a political and communications consultant. Twitter @MachelWaikenda)