Uganda signs Euro 2.7B Standard Gauge Railway works contract with Turkish firm
Uganda signs Euro 2.7B Standard Gauge Railway works contract with Turkish firm
Government of Uganda has signed a Euro 2.7 billion contract for the construction of the Eastern Route Standard Gauge Railway (SGR) line.
The construction will cover 272KM between Tororo and Kampala and works expected to be launched soon will take 48 months.
During the signing, Uganda was represented by the Minister of Works and Transport while the contractor is M/s Yapi Merkezi Yapi Merkezi, a Turkish firm who is in a joint venture with YM Global Ltd.
In his speech after the contract signing, the minister of works and transport Gen. Katumba Wamala tasked Yapi to ensure that the project’s Local Content Strategy is adhered to to ensure that local capacity is enhanced and that Ugandans benefit from the project right from the start. Government plans to reserve 40% of the contract value for local suppliers.
“I implore you to be transparent in all matters of local content to avoid disputes which can hamper project delivery. This will enhance acceptability of the project,” noted Gen Katumba.
The Permanent Secretary in the Ministry of Works and Transport Waiswa Bageya said Uganda will use its domestic resources and financing from development partners such as development financing and Export Credit Agencies to finance the project.
“The EPC/T model of Contracting ensures timely completion and minimizes all associated risks that shall be borne by the Contractor,” said Bageya.
In a ceremony graced by heads of agencies among others the Permanent Secretary and Secretary to the Treasury (PSST) Ramathan Ggoobi, Katumba praised both the contracting team and the SGR team for their resilience despite many challenges.
SGR Uganda Project Coordinator Can. Eng. Perez Wamburu recounted the two important dates that triggered a series of events that finally led to the contract signing. One was the October 26th, 2021 meeting between the Minister of Works and Transport and the Chinese Ambassador and the other was the July 11, 2022 President’s letter to Ministry of Finance, Planning and Economic Development.
The above two dates triggered a lot of events around the project among them, signing of a MoU (with YAPI), due diligence on Yapi, Request for Proposal, Response to the RFPs and negotiations.
Dr Erdem Arioglu, Yapi Merkezi vice chairman described the occasion as a new chapter in the Uganda-Turkish relations.
Despite a delay in commencing construction, a lot has been achieved. Todate, about 150km of land out of the 272km of the Right of Way between Malaba and Mayuge has been acquired. This translates into about 54% of the entire ROW from Malaba-Kampala. Necessary studies and harmonization of SGR plans with other infrastructure projects have also been undertaken.
Uganda plans to develop approximately 1,700KM of SGR in a phased manner starting with the Eastern Route from the border with Kenya at Malaba to Kampala (272km).
Other SGR lines include the Northern Line from Tororo-Gulu-Nimule (at the South Sudan border) (465km) with a spur from Gulu-Pakwach to Vurra (at the DR Congo border - 297 km); the Western Line from Kampala- Bihanga-Kasese - Mpondwe (DR Congo border) with a spur to Hima Cement (383Km); and Southern line from Bihanga - Mirama hills (Rwanda border) with a spur to Muko (280 km).
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