A bilateral agreement to build a new 3000km electrified Standard Gauge Railway (SGR) from Lamu Port in Kenya to the Ethiopian capital Addis Ababa has been signed by Kenya’s cabinet secretary for transport, Mr Kipchumba Murkomen, and his Ethiopian counterpart, Dr Alemu Sime.

The new line forms part of the project to develop the Lamu Port-South Sudan-Ethiopia (Lapsset) transport corridor, centred on the new port of Lamu. From Lamu, the railway would run to Isiolo, 200km northeast of Nairobi, then divide into three branches running to Nairobi, Addis Ababa and Juba, the capital of South Sudan.

“We are currently working on the development of the railway line from Lamu to Moyale through Isiolo, with a link from Isiolo to Nairobi to connect with the Mombasa - Nairobi - Malaba SGR,” Murkomen said.

“We further agreed to establish a bilateral steering committee comprising officials from Kenya and Ethiopia to fast-track the development of the Lapsset Corridor and its supporting infrastructure,” he added.

Construction of the new line is expected to start in 2025 and would cost $US 13.8bn. According to Kenya’s Lapsset Corridor Development Authority (LCDA), the forecast internal rate of return for the project is over 12%.

Kenya and Ethiopia are now working together to seek funding for the project. Kenya is seeking $US 9m from the African Union Infrastructure Fund for studies to determine the technical and economic feasibility of building the new line.

Three berths have recently been completed at Lamu at a cost of $US 400m, and Kenya is keen to develop the new port to handle imported goods destined for southern Ethiopia.

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