The Kenyan government is pursuing up to $4 billion in additional funding to extend its Standard Gauge Railway (SGR), to be raised through securitisation, Bloomberg reported on Monday, quoting the Transport Secretary Davis Chirchir. The funding is intended for the next phase of the SGR, which was initially financed through Chinese loans and remains incomplete.
According to the report, Chirchir confirmed the government is in active discussions with Etihad Rail to secure a concession for freight operations. Under the proposed model, Etihad Rail would invest in rolling stock, including trains and wagons, and manage freight services on the SGR. The company has expressed interest in handling 17 million metric tonnes of cargo, a volume they say is necessary to break even or achieve profitability.
The deal remains under negotiation. The government has already completed feasibility assessments and route mapping. Concurrently, land compensation processes for affected communities are underway.
This move comes as Kenya aims to revive stalled regional integration efforts. The current SGR stretches from Mombasa to Nairobi and Naivasha, with plans to extend toward Uganda and beyond, including Uganda, South Sudan, Rwanda, and the DRC.
Securing $4 billion through securitisation, likely backed by levies such as fuel or import charges, would signal a shift toward domestic funding mechanisms, potentially reducing debt dependency on foreign financiers.
