Kenya Restarts Stalled Railway Project with £3.7 Billion Investment After Six-Year Delay

2026-03-20 region

Nairobi, 20 March 2026
President William Ruto launched the second phase of Kenya’s Standard Gauge Railway on 19 March 2026, reviving a project that had been stalled since China reduced funding six years ago. The £3.7 billion extension will connect Naivasha to the Uganda border at Malaba, spanning 371 kilometres across nine counties and designed to handle 4,000-tonne freight trains at 80 km/h speeds.

From Funding Crisis to Alternative Finance

The project’s revival marks a dramatic turnaround from Kenya’s infrastructure deadlock that began in 2018 when Chinese Belt and Road Initiative funding dried up, leaving the railway stranded more than 350 kilometres short of the Ugandan border [5]. Kenya’s groundbreaking revenue securitisation scheme, detailed in previous coverage of the project’s restart (https://kakuma.bytes.news/e236aab-railway-infrastructure-China-funding/), has now materialised into tangible construction activity. The government has committed Sh582 billion [1] to the project, with funding negotiations continuing with Beijing firms [2] and new partnerships emerging with the UAE following a comprehensive economic partnership agreement signed on 17 March 2026 [2]. In November 2025, Roads and Transport Cabinet Secretary Davis Chirchir announced plans to issue a Sh390 billion bond backed by the Railway Development Levy Fund to partially finance the project [2].

Strategic Infrastructure Design and Regional Impact

The railway extension comprises two distinct phases: the 264-kilometre Naivasha-Kisumu section (Phase 2B) and the 107-kilometre Kisumu-Malaba section (Phase 2C) [2][5]. The project will feature substantial infrastructure including 79 bridges covering 43 kilometres, eight tunnels spanning 14.26 kilometres, and 376 culverts [1]. Freight trains will operate at 80 kilometres per hour with a capacity of 4,000 tonnes, while passenger trains will reach 120 kilometres per hour carrying up to 1,096 passengers [5]. The designed freight capacity of 22 million tonnes per annum [5] positions the railway as a critical artery for regional trade, connecting landlocked neighbours including Uganda, Rwanda, Burundi, South Sudan, and the Democratic Republic of the Congo [1][7].

Kisumu Port Revival and Economic Transformation

A cornerstone of the project centres on reviving Kisumu as a major logistics hub, with the main terminus located in Kisumu West and supported by two freight stations at Kibos and Kodiaga [1]. The railway will include an 8.69-kilometre branch line connecting to Kisumu Port [2][4], integrating rail and lake transport across Lake Victoria in a multimodal approach that offers a cost-effective alternative to road transport [1]. This strategic positioning aims to revive historical trade routes linking Kenya to neighbouring countries via the lake, potentially transforming the economic landscape of Western Kenya. Counties along the route—including Narok, Bomet, Kericho, Nyamira, Kisumu, Siaya, Vihiga, Kakamega, and Busia—are expected to experience increased economic activity [1][4], particularly benefiting agricultural regions producing tea, maize, sugar, and rice through faster access to domestic and export markets [1].

Implementation Timeline and Cross-Border Integration

Kenya Railways Managing Director Philip Mainga has indicated that Phase 2B will be completed by June 2027 [5], with construction being implemented by China Communications Construction Company [3]. President Ruto is expected to host Ugandan President Yoweri Museveni on 21 March 2026 for the groundbreaking of the final phase from Kisumu to Malaba [2], demonstrating the project’s regional significance. The National Land Commission has identified Kisumu County as having the highest number of affected landowners, with Director Joel Ombati announcing that a digital platform will map parcels and ownership data to complete compensation within eight months [2]. The railway features uniform design specifications to permit seamless operation across borders [5], reinforcing Kenya’s position as a transport and logistics hub in Eastern and Central Africa while potentially improving access to markets and economic opportunities for refugee communities in the broader region through enhanced cross-border connectivity.

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infrastructure development railway expansion