NAIROBI, Kenya — Kenya is facing renewed pressure to accelerate the Standard Gauge Railway (SGR) extension to the Ugandan border after Uganda issued a Sh62 billion bond to kick-start construction of its own rail network.
Uganda’s financing push is expected to fast-track its section of the cross-border railway, increasing urgency on Kenya to complete its delayed Naivasha–Malaba corridor that is meant to connect East Africa’s landlocked economies to the Port of Mombasa.
According to reports, Uganda has launched a shariah-compliant Sukuk bond in two segments, raising funds domestically and regionally to support the construction of its railway line.
The move is seen as a strategic signal to Nairobi, where Kenya’s SGR currently ends in Naivasha—over 350 kilometres short of the Ugandan border—despite earlier plans to extend it through Kisumu to Malaba.
Kenya has in recent months revived its stalled extension plan, shifting to a revenue securitisation model that relies on future collections from the Railway Development Levy to raise financing for construction.
The government is targeting a Sh390 billion bond to fund the Naivasha–Malaba stretch, which is estimated to cost more than Sh500 billion, according to Treasury projections.
The cross-border rail project is designed to strengthen regional trade integration between Kenya, Uganda, Rwanda, Burundi, and the Democratic Republic of Congo by lowering freight costs and improving transport efficiency.
However, funding constraints, debt sustainability concerns, and past withdrawal of external lenders have slowed progress on Kenya’s side, leaving a visible gap in the regional infrastructure chain.
Uganda’s latest bond issuance now shifts momentum in the regional race to complete the railway corridor, placing additional political and economic pressure on Kenya to secure financing and fast-track construction timelines.
Kenya has already begun preliminary steps, including land compensation and planning for the extension, but full-scale construction beyond Naivasha has not yet been completed.
The SGR project, originally launched in 2017 with the Mombasa–Nairobi line, has faced multiple delays beyond Naivasha following funding challenges and changing financing models, including reduced appetite from traditional lenders.
