After canceling the contract with a Chinese company, Uganda has entrusted Citigroup of the United States to arrange $3.2 billion in railway financing

¬ Uganda appoints Citigroup to arrange $3.19 billion in railway financing

¬ The project connects the capital Kampala with the Kenyan border, promoting regional trade connectivity

¬ This move follows the cancellation of the contract with China, as Uganda shifts to a new agreement with Turkey’s Yapi Merkezi Company

The Ugandan government said on Thursday it has appointed Citigroup to arrange financing for the Standard Gauge Railway (SGR) linking the capital Kampala to the Kenyan border, valued at €2.7 billion (approximately $3.19 billion).

Ramathan Gobi, Permanent Secretary of the Ministry of Finance, stated that Citigroup will serve as the lead arranger and coordinate the financing efforts for the railway project. He made the remarks during a tripartite finance ministers’ meeting among Uganda, Kenya, and Rwanda held in Washington, D.C., coinciding with the IMF and World Bank 2026 Spring Meetings.

He added that Uganda has begun consultations with the World Bank to secure support for the project. The project is expected to enhance regional connectivity, reduce freight costs, and strengthen trade competitiveness.

Paving the Way Toward Deeper Regional Integration

In 2015, Uganda awarded the railway construction contract to China Harbour Engineering Company (CHEC), contingent upon the company securing financing from the Chinese government. Due to delays in funding, the Ugandan government canceled the contract in January 2023 and signed a new agreement in October 2024 with Turkey’s Yapi Merkezi Group to build the railway connecting Kampala to Malaba on the Kenyan border.

The project is expected to link landlocked Uganda’s rail network with Kenya’s railway system and the port of Mombasa on the Indian Ocean coast.

In March this year, Kenyan President William Ruto launched construction of the next phase of Kenya’s Standard Gauge Railway (SGR), connecting Naivasha to Kisumu. A subsequent phase is expected to extend the line further to the Ugandan border. Since 2019, Kenya’s SGR has already connected Mombasa, Nairobi, and ultimately reached Naivasha.

In the long term, Kenya and Uganda aim to extend this line to other landlocked countries, including Rwanda, South Sudan, and the Democratic Republic of the Congo, forming a regional rail network to boost trade development across East and Central Africa.

Source: ecofinagency

Original article: toutiao.com/article/1862857006564424/

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