October 3, 2022


MOBASA, Kenya — Fireworks exploded and confetti rained down in the coastal city of Mombasa as Kenya’s president inaugurated the country’s new railway — designed, financed and built by China.

President Uhuru Kenyatta has declared that the new train will connect the port of Mombasa with the neighboring country of Uganda, create jobs and help transform Kenya into an industrialized middle-income country.

“This is a very historic moment,” President Kenyatta said, waving a giant Kenyan flag at the gathering of Kenyan and Chinese officials. “We should be proud.”

That was five years ago. Since then, the railroad has turned into a fiasco, the target of lawsuits, criminal investigations into corruption and resentment from environmentalists and displaced trucking workers.

Now, it is a hot topic in the highly contested August 9 election and part of a wider debate about China’s expanding role in Kenya. The leading candidates have proposed everything from deporting Chinese workers doing local jobs for the renegotiation of the onerous debt owed by Kenya to China. But for many, the railroad, which cost $4.7 billion, epitomizes corruption and greed among the political elite.

China originally financed the railway as part of the trillion-dollar Belt and Road initiative, which aimed to expand China’s economic and political influence by funding new ports, roads and railways worldwide. However, China has refrained from financing the final section of Kenya’s railway – the link to Uganda – as some African countries struggle to repay their debts.

The train tracks run 367 miles from Mombasa through the capital Nairobi — and end abruptly in an empty field in the Rift Valley, more than 200 miles from Uganda.

“The SGR is an economic, social and fiscal disruptor,” said Tony Watima, an economist, referring to the Standard Gauge Railway, which Kenyans call a train. “The disruption it has created in Kenya’s economy will be felt for years.”

Both leading candidates in the campaign to succeed President Kenyatta — William Ruto and Raila Odinga — have seized on the railway’s woes, promising to reassess its operations while also trying to distance themselves from the project.

Mr Ruto is the deputy president and member of the administration that launched the railway. In an interview, he acknowledged that Kenya’s public debt — totaling $73.5 billion in March in a country with a gross domestic product of just over $100 billion — created a “very precarious” situation and that the railway had so far failed to the economy develops.

“We’re getting old paying off Chinese debt,” he said.

His opponent, Mr Odinga, is a former prime minister who had long criticized the project and accused Mr Kenyatta’s family of profiting from it. But now that President Kenyatta is backing him, Mr Odinga has softened his criticism while promising to overhaul the operation of the railway. He recently told a crowd of supporters in Mombasa: “Once I take over, we will fix it.”

The railway represents the height of the borrowing and looting that has plagued Mr. Kenyatta’s government since it took office in 2013, economists, analysts and government officials said in interviews. His government, they said, has saddled the country with large-scale infrastructure projects that are not economically sustainable, largely benefit the wealthy and divert investment from education and health. In the past nine years, Kenya’s public debt has almost quintupled.

“The standard gauge railway is the jewel in the crown of corruption in Kenya,” said John Githongo, a former anti-corruption czar. “This is a sad legacy of the current regime.”

Mr Kenyatta’s office did not respond to emailed questions for this article. The government’s finance and planning minister, Ukur Yatani, who oversees the country’s port, rail and pipeline infrastructure, did not respond to requests for an interview.

The railway’s financier, the Exim Bank of China, has demanded compensation, even as creditors such as France and Japan have given Kenya some respite from servicing their loans due to the pandemic. To repay the loan, the government has introduced a series of taxes and austerity measures that have angered the public, which is dealing with rising food and fuel prices stemming from Ukraine’s drought and war.

There was a “lack of financial planning and foresight” for the railway’s commissioning, said Abdullswamad Shariff Nassir, an MP who chairs the public investment committee in Parliament.

For years, Kenya has debated whether to build a new railway or renovate the line built a century ago by British colonialists and known as the “Crazy Express”.

Independent reports, including the World Bank, are recommended upgrading the existing railway network as a cheaper option. But eventually, the Kenyatta administration built a new one: a standard-gauge railway on which freight trains could run at 50 miles per hour and passenger trains at 74 miles per hour.

Groundbreaking began in 2013. But problems dogged the project from the start.

Although it was funded by taxpayers, it didn’t exist competitive bidding for the project — a move by Mr Kenyatta defended.

Environmentalists wondered because the government ran the railway through the Nairobi National Park, one of the few wildlife parks anywhere near a capital city.

The only known feasibility study of the project was done by the Chinese contractor — not the government — which presented a conflict of interest, said Okiya Omtatah, a prominent lawyer who challenged the project in court.

He said he was invited to a Nairobi hotel to meet with several Kenyan senators and Chinese managers who asked him to drop the case in exchange for a $300,000 payment. When he refused, one of the senators offered up to $1 million, he said. They told him that if he refused, they could pay a judge to decide the case in their favor.

“You keep your money and I’ll keep my country,” Mr Omtatah recalled telling them as he left the room.

A contact person for CRBC, the Chinese contractor, did not respond to emailed questions. Mr Omtatah would not identify the senators he said he met.

The Court of Appeal finally ruled in Mr Omtatah’s favor in 2020, declaring the railway contract illegal for breaching the procurement laws of Kenya. The government is appealing the decision to the Supreme Court.

Mr Ruto has promised, if elected president publish the contract — a move activists hope will allow the public to scrutinize it. A Transportation Department official said this year that making the contract public would undermine national security because it would expose non-disclosure clauses.

Over the years, activists and opposition figures have accused senior politicians of inflating cost and profit from the railway.

Land acquisitions have also become a flashpoint, with more than a dozen officials, including the former chief executive of Kenya Railways and the former chairman of the agency that manages Kenya’s public land, charged in court in 2018, accused of facilitating more than $2 million in payments to individuals and companies who falsely claimed to own land along the railroad. While some cases have been dismissed, the trials of other defendants continue. Parliament revealed that millions more were disbursed overpayments or payments made without clear documentation.

A year after the train opened, a parliamentary report showed that it cost more than twice as much to transport goods by train than by road.

To make the railroad profitable, authorities forced importers to ship by rail instead of by road — a decision that sparked protests and court cases.

Officials in Mombasa said the railway cost their county tens of millions of dollars in annual revenue. A estimated exposure Conservatively over 8,100 people employed in the county’s trucking, fuel and freight operations would lose their jobs.

Lawrence Boye, a truck driver in Myritini, a suburb of Mombasa, accused the government of “demonizing” truck drivers and leaving many young people unemployed and turning to crime.

“We are citizens of this country,” he said, “and we deserve equal rights.”

At Nairobi station, passengers board train cars painted with the slogan, “Connecting Nations. Prosperous People.” But a 2019-2020 poll by Afrobarometer found that 87 percent of Kenyans they believed their government had borrowed too much money from China.

Lawmakers recommended the government renegotiate the railway loan with China. But even if they can, said Mr Watima, the economist, the railway will remain a “serious mess”.

China is also reassessing its early lending spree for African infrastructure projects as it faces growing backlash over lending to poor countries with fragile economies.

Although China will remain the largest funder of African infrastructure, Eric Olander, co-founder of the China Global South Project, said it is unlikely that risky, large-scale projects such as Kenya’s railway will receive funding in the future.

“The sand in the hourglass has run out,” he said.

For now, the railway leaves Mombasa, passes through Kenya’s iconic national parks, barrels past Nairobi, before its tracks stop at a quiet hamlet near the town of Duka Moja, surrounded by dense bush and maize plants.

“They said this train was progress, but whose progress is it?” said Daniel Tipape, a motorcycle taxi driver, crossing the dirt road near the finish line of the railway line.

“Sometimes we just build things for the sake of it,” he said.





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