Tanzania awards US$2.2 Billion Rail Contract to Chinese Consortium
The final section of the Tabora-Kigoma Standard Gauge Railway is scheduled for completion in 2026.
The Tanzanian government has signed a contract with a Chinese joint venture to construct the Tabora-Kigoma Standard Gauge Railway SGR rail line.
China Civil Engineering Construction Corporation (CCECC) and China Railway Construction Corporation (CRCC) were awarded the construction contract for the 506 kilometres SGR rail line from Tabora to Kigoma on Lake Tanganyika.
The project is estimated to cost US$2.21 billion and is expected to be completed within 48 months (i.e. in 2026).
The Tabora to Kigoma rail line is the last section of the country's SGR railway system currently under development. Tanzania's SGR railway system which will link Tanzania to the neighbouring countries of Rwanda and Uganda, and through these two countries, to Burundi and the Democratic Republic of the Congo, as part of East African Railway Master Plan.
President Samia Suluhu Hassan witnessed the signing of the contract for the project. Speaking at the contract signing ceremony, she said “Upon completion of the SGR, Tanzania will be in a better position to utilise its strategic geographical positioning to facilitate cross-border trade. We have to borrow for this important infrastructure and other sustainable development projects because we don’t have enough local resources”.
On Dec 20, the signing ceremony of the 506 km final section of the Standard Gauge Railway (SGR) from Tabora to Kigoma was held.— CCECC (@CCECC8) December 23, 2022
The project is the largest single contract project undertaken by a Chinese enterprise in Tanzania. pic.twitter.com/4xqvz5cXdj
Tanzania's SGR railway system consists of a network of approximately 1,901 kilometres, and is being developed in six phases:
- Phase 1: Dar es Salaam -Morogoro (300 kilometres). Construction was launched on 12th April 2017 and was undertaken by Turkish firm, Yapı Merkezi, in partnership with Portuguese firm, Mota Engil. Construction was completed in April 2022 and the railway is currently in the testing phase.
- Phase 2: Morogoro-Makutupora (422 kilometres). Construction was launched on 14th March 2018 and is still ongoing. The project is being undertaken by Turkish firm, Yapı Merkezi.
- Phase 3: Makutupora-Tabora (294 kilometres). Construction was launched on 12th April 2022 and is still ongoing. The project is being undertaken by Turkish firm, Yapı Merkezi.
- Phase 4: Tabora-Isaka (130 kilometres). The contract for this phase was signed between Tanzania Railway Corporation (TRC) and Yapi Merkezi on 14 July 2022. Construction works commenced on 18 January 2023 and are ongoing.
- Phase 5: Isaka-Mwanza (249 kilometres). The contract for this phase was signed between the government of Tanzania and a Chinese joint venture comprising CCECC and CRCC in January 2021. Construction works on this phase are ongoing.
- Phase 6: Tabora-Kigoma (506 kilometres). The contract for this phase was signed between the government of Tanzania and a Chinese joint venture comprising CCECC and CRCC on December 20 2022.
With this latest contract award for the Tabora-Kigoma section, Tanzania’s investment in the SGR will reach US$10.04 billion. President Samia Suluhu Hassan noted, “I know our critics blame us for taking up these loans, but they must understand that a better infrastructure is key to driving growth in our country and making Tanzania competitive at the regional level.”
The new rail line is expected to reduce cargo transportation costs between Dar es Salaam port and the Democratic Republic of Congo (DRC) from US$6,000 per tonne to US$4,000 per tonne once fully operational. Transportation time is also expected to drop drastically from 30 days to 30 hours by truck by 2027.
Top Photo: Signing the contract for the construction of a 506-km Tabora-Kigoma Standard Gauge Railway (SGR) at the State House in Dar es Salaam (@ChenMingjian_CN Twitter Handle | Ambassador of the People's Republic of China to the United Republic of Tanzania)
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