In 2014, when the China Road and Bridge Corp. began building the Standard Gauge Railway (SGR) in Kenya, Beijing said the project would be one of its greatest achievements under its Belt and Road Initiative (BRI).
The Chinese Communist Party (CCP) had launched the BRI just a year before, promising massive infrastructure builds that would revitalize stagnant economies across the world, including in Africa.
It claimed that the railway would eventually link the entire East African region, including Kenya, Tanzania, and Uganda.
These countries have traditionally used trucks to ferry goods between one another. But East Africa’s roads are notoriously poor, so products take a long time to reach markets, if they ever do, given the high rate of road accidents.
The Chinese-built rail network was seen as essential to speeding up trade and transport, and in so doing earning the countries billions of extra dollars every year.
A decade later, much of the SGR remains unfinished, leaving Kenya servicing loans of almost $5 billion taken from Chinese banks.
“This was an outrageous claim, and Kenya should’ve realized that,” David Taylor, a Cape Town, South Africa-based independent rail operations expert who focuses on East and Central Africa, told The Epoch Times.
“The SGR carries less than a quarter of the freight originally promised by the Chinese, and this makes it impossible for the line to pay for itself.
“But, of course, even as the Kenyan fiscus bleeds hundreds of millions of dollars in losses because of the SGR, China still expects it to pay back loans.
“In 2022, the debt it incurred because of the SGR project more than doubled to almost $560 million.”
However, Beijing, using its media mouthpiece, Xinhua, has presented the SGR as an untrammeled success.
Xinhua reported that the SGR had “operated without major hitches for 2,314 days” and that the line stretching from Mombasa to the town of Naivasha had transported 2,405 million standard containers and almost 30 million metric tons of goods since 2017.
“The number of passengers transported through the Mombasa–Nairobi–Naivasha SGR in the same period stood at 11.155 million, with an average seat occupancy rate of 95.8 percent,” Xinhua stated.
But, according to Mr. Taylor, the SGR’s “extremely limited” success had come at a “ridiculous cost” to Kenya.
The first leg of the railway, a 300-mile line running between Kenya’s capital, Nairobi, and its major Indian Ocean port, Mombasa, was completed in 2017.
However, in 2019, work on the tracks came to a juddering halt in a field in the middle of the country, at Naivasha, with China reneging on pledges to extend the railway to Malaba, a town on the Kenya–Uganda border.
“Citizens are happy that the passenger service between Nairobi and Mombasa is running smoothly,” Kenyan economist Anzetse Were said.
“What we’re all unhappy about is that our tax money’s being used to pay for a ‘ghost’ railway that ends in the middle of nowhere 300 kilometers away from the border.”
The plan to link Kenya to other parts of East Africa by rail seems to be off the table.
“So what we have now is a line to Naivasha. We have freight trains picking up a few goods in Naivasha, like flowers and maize, but most of the trains return to Mombasa empty, and that’s a big loss of income,” Ms. Were said.
“If Kenya was getting that income, we’d be able to pay off our debt. The SGR was supposed to take containers that arrive at Mombasa into DRC [Democratic Republic of the Congo], Rwanda, and Uganda and then bring goods from those countries into Kenya.”
Many Kenyan cargo companies did not use “what little of the railway exists,” because its added tariffs and fees made it much more expensive than truck transport, she said.
So the regional economic boom that the SGR was supposed to ignite appears stillborn.
In 2021, the Kenyan government acknowledged that the SGR recorded a loss of $200 million that year.
Chinese loans made up almost 70 percent of Kenya’s debt, which was at a historic high of $82 billion, or about three-quarters of the national gross domestic product, according to Ms. Were.
“We’re paying the Chinese, leaving us with no money for health care and education,” she said.
“Some might say we dug this hole for ourselves, but that’s only partially true.
“We have our suspicions of why it all happened in darkness.”
Kenyan economist Kenneth Gichinga said that there remains a “widespread perception that lots of the money involved in the SGR project did go toward building railway lines.”
The council’s research noted that loan terms were usually not made public and that “because China refused to join the Paris Club of major official creditors,” Chinese banks were not required to cap lending rates or to share information.
Patrick Njoroge, former governor of the Central Bank of Kenya, told The Epoch Times that his country’s debt to China was “crippling” its economy.
“We’re a poor country, and any debt we incur, we need to be sure that debt is taking us in a good direction. These megaprojects are draining our economy when they should be boosting the economy,” he said.
Mr. Taylor said the SGR would only succeed if there was “buy-in” from Kenya’s neighbors, Tanzania and Uganda.
However, in January 2023, Uganda announced that it was canceling a contract with a Chinese company to build a railway from its capital, Kampala, to the Kenyan border.
It subsequently awarded the job to a Turkish company.
In 2017, then-Tanzanian President John Magufuli declared a railway deal that had been signed by his predecessor with China “void.”
Instead, he secured funding from Portugal and Turkey to finance the first leg of the project linking Tanzania with Zambia.
“I don’t know the behind-the-scenes things that have gone on in Tanzania, but it seems strange to me that the president is now allowing the Chinese back in,” Mr. Taylor said.
“As far as I know, the Turks and Portuguese have done a good job so far in constructing a railway line that’s cost much less to build than initially thought and one that also offers higher speeds, as it’s electrified.”
Sanusha Naidu, Africa analyst at the Institute for Global Dialogue in Pretoria, South Africa, said the “constant flip-flopping” by East African countries about Beijing’s role in railway construction was indicative of the “ambivalence” currently being felt across the entire continent with regard to China’s presence.
“There’s recognition that China’s responsible for the biggest infrastructure projects ever seen in Africa, and the continent’s thankful for that,” she told The Epoch Times.
“But at the same time, its people aren’t blind to China’s subterfuge and broken promises, and they aren’t blind to China’s appetite for African minerals and other resources.
“The SGR is one of those projects that should teach Africa what to expect from its relationship with Beijing and should show Africa that the sooner it can stand on its own feet, the better.
“But for that kind of independence, we need leaders who don’t enslave their countries to the world’s major powers, including China.”
