Rwanda and Tanzania agree on joint construction of the SGR from Isaka to Kigali

Posted on :Monday , 5th February 2018

 In a meeting of finance ministers from Rwanda and Tanzania on Monday in Dar es Salaam, Tanzania, consideration was given the finance matters regarding accomplishment of the two countries’ US $2.5bn joint 521 km Isaka-Kigali SGR (Standard Gauge Railway) project. 

 
Amb. Claver Gatete, the Rwandan Minister for Finance and Economic Planning, and his delegation including the Permanent Secretary and Secretary to the Treasury, Caleb Rwamuganza, met with his Tanzanian counterpart, Dr. Philip Mpango and his team as a follow up to the meeting held earlier by the Ministers for Infrastructure on the same project.
 
According to Gatete, it is all work in progress and they continue to look at matters such as structure of financing, possible partnerships, and the progress of the project. “We are on the right track as our meeting was a follow up to that held recently by the ministers for infrastructure of Rwanda and Tanzania in Dar es Salaam. We shall continue to discuss the possible options, including partnership with the private sector and any other partners,” said Gatete.
 
Sources say, that the delegates agreed that some critical issues including feasibility studies impacting on cost be re-examined so that both countries have a clearer picture on the financial implications before charting the way forward as regards mobilizing funds.
 
The project’s estimated total cost of US $2.5bn was made in 2015 and it is possible that there could be changes that need to be well factored in considering inflation and other economic factors.
 
Rwanda and Tanzania agreed on joint construction of the SGR from Isaka (northwestern Tanzania) to Kigali, to facilitate movement of goods and services, following a meeting between Presidents Paul Kagame and John Pombe Magufuli, during the former’s one-day working visit to Dar-es-Salaam, mid-January.
 
On January 14, the two countries’ leaders directed their ministers responsible for transport to meet within two weeks to deliberate on how to implement construction of the joint railway line.
Nearly 80 per cent of Rwanda’s imports and exports go through Tanzania.
 
When Ministers for Infrastructure met in Dar es Salaam, on January 20th to consider implementation of the joint project they, among others, adopted feasibility studies already conducted in the two countries, agreed that the foundation stone be laid by October, and the two countries jointly mobilizing funds for construction of the joint project with each country meeting the cost of infrastructure in its own territory.
 
Gatete reiterated that appropriate efforts are being put in to fast-track things such that the foundation stone is laid before year end.
 
Earlier, the Ministers for Infrastructure adopted the proposed timeline towards implementation of the Presidents’ directives so as to lay the foundation stone by October, 2018.
 
Officials in both countries say the project is crucial as, once realized, it will reduce transport costs, foster physical integration of transport modes, economic growth and improved social services in the sub region, among others.

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