Chinese companies dominate bidding for EAC railway project

EAC leaders launching the Standard Gauge Railway project in Kampala, Uganda

EAC leaders launching the Standard Gauge Railway project in Kampala, Uganda last year

Railway project connecting Rwanda, Burundi and Tanzania is now open to private bidders with more Chinese companies dominating the bidding process.

In a statement issued Tuesday Rwanda Transport Development Agency (RTDA), the leading procurement arm for the three countries said on Tuesday that 12 companies have been shortlisted and the tender winner will be announced soon.

Some of the Chinese companies fighting for the mega deal include; China Railway Group, China Communications Construction Co, China Civil Engineering Construction Corp and Sinohydro Corporation Ltd, and China Railway Materials and Beijing National Railway Research & Design Institute of Signal & Communication Group.

The contracted company will be obliged to develop and implement the proposed 1,672 km railway line linking Dar es Salaam (Tanzania) with Kigali (Rwanda) and Musongati (Burundi). Construction is due to begin next year and end in 2018.

The mixed-traffic DIKKM railway would be built to 1,435 mm gauge, in line with East African Community and African Union policies for new lines in the region, and would be suitable for 2, 000 m long freight trains with 32•4 tonnes axle loads. An estimated 172 km portion of the route will be in Burundi and 123 km in Rwanda. There will be 407 km of new alignment in Tanzania from Keza to Isaka, and 970 km paralleling the existing metre-gauge line between Isaka and Dar es Salaam.

The three States involved in a multi-national railway project have signed a Memorandum of Understanding (MoU) for the development of this ambitious project.

According to the MoU each partner state is expected to facilitate the creation of the route for the Railway line within their territories, initiate and facilitate technical studies, including mobilisation of funds towards the necessary study for the implementation of the project and guarantee financial commitment.

This will be based on the equity share, a Public Private Partnership (PPP) model was adopted for the development of the railway line.

The railway development comes after member states of COMESA, SADC and EAC achieved the highest level of cooperation, by holding the first ever tripartite summit of the three Regional Economic Communities (RECs) last year in Kampala, Uganda.

Not all East African Community (EAC) are on board with the Tanzania-Rwanda-Burundi joint railway project, Uganda and Kenya plan to enter a joint railway deal with South Sudan. Kampala and Nairobi prefer linking up with Juba given its economic potential.

Chinese companies stand a good chance to emerge victorious in the ongoing bidding process.

In May this year, the Tanzanian government awarded a lucrative contract to a Chinese consortium to build a 2,561 km (1,536 miles) $9 billion standard gauge railway connecting Dar es Salaam port to land-locked neighbours.

“A consortium of Chinese railway companies led by China Railway Materials (CRM) has been picked to help us build the railway line,” Tanzania’s Transport Minister Samuel Sitta told parliament this May.

EAC leaders say these kinds of projects will help speed up economic integration and in the end facilitate inter-state trade.