Transport and Infrastructure
Kenya Railways Corporation (KRC)
Commuter rail services were introduced in the city of Nairobi in May 1992, in response to a series of matatu strikes, which crippled commuter transport services in the city. Effective November 1, 2006, Kenya Railways conceded railway operations to a consortium of private sector investors (Rift Valley Railways (K) Ltd.) Notwithstanding the assumption of operations by the private sector, commuter rail service levels have deteriorated significantly, with dilapidated coaches pulled by superannuated locomotives that are often pulled off local service in favor of long distance freight. The existing track and signaling system also limit the frequency of service; currently four routes are run, each with one train in the morning and one in the evening. The project seeks to establish a commercially viable commuter rail service capable of serving a maximum number of passengers safely, reliably and with affordable tariffs. The project is set to contribute to a sizable reduction of traffic congestion within and around Nairobi that will have considerable positive effects on productivity. Additionally, the Project will employ over 500 people during the operational phase, and is expected to lead to the indirect employment of over 2,000 people. The Project will also have a positive impact on air quality through its reduction of traffic flow and congestion.
The project entails the rehabilitation of existing 100km railway line, and doubling of sections and support infrastructure. Additional services include: Rehabilitation of 4 existing stations and construction of 13 new stations, including a new station at JKIA; Construction of 5-7 Km of new track from Nairobi Central Station to JKIA; Construction of new tracks, depots, bridges and other facilities throughout the rail network; Introduction, operation and maintenance of new, modern purpose built rolling stock (locomotives and coaches); and Commissioning of a new signaling system.
The provision of public infrastructure and services such as water, power and roads is key mandate of the Government. Infrastructure investments are known to accelerate much-needed growth in developing countries, such a Kenya, and reduce income disparities. However, poor infrastructure is often a reflection of several constraints faced by the Government, for example, insufficient public funds, poor planning or weak analysis underpinning project selection. Infrastructure assets are also often poorly maintained. These challenges, coupled with fiscal constraints, have prevented the Government from adequately improving the current public infrastructure and expanding service provision to meet the current demand. To rise above this problem, among other things, the Government of Kenya is leveraging private finance through Public Private Partnerships (PPPs). Through PPPs, the Government will have access to additional financing while the private sector develops and maintains infrastructure in a more efficient way, for a profit. PPPs if implemented well can help overcome inadequate infrastructure that constrains economic growth in Kenya. Beyond the broader economic effects, PPPs can benefit the poor through several channels including job creation and improved service provision.
InfraCo Ltd (“InfraCo”) The Transaction Advisor was engaged to develop, on a private commercial basis, a commuter rail network to serve the residents of Nairobi and its immediate suburbs (the ”Commuter Rail Service”). The services shall include: Pre-feasibility studies; Project feasibility studies, including assessing PPP options, environmental, and social and gender safeguards considerations, financial analysis and modeling, and project structuring; Preparation of bidding documents and draft contracts; and Provision of support during the bidding process until financial close.
Information will be published as soon as it is available.