Kenya has initiated discussions with the United Arab Emirates (UAE) to secure financing for the completion of its regional Standard Gauge Railway (SGR), President William Ruto announced.
The move comes after China, the project’s original financier under its Belt and Road Initiative, withdrew support in 2019, leaving the railway 468 kilometers short of the Ugandan border.
Reviving the Railway Ambitions
Speaking on social media platform X after a meeting with UAE officials in Abu Dhabi, Ruto revealed Kenya’s plans to partner with the UAE to extend the railway to connect Kenya with its landlocked neighbors, Uganda and South Sudan.
“We are exploring a partnership agreement with the United Arab Emirates to extend the Standard Gauge Railway to connect Kenya, Uganda, and South Sudan,” Ruto stated.
Both countries will conduct a feasibility study for the railway extension, which Ruto said would enhance regional integration and boost trade.
Strengthening Kenya-UAE Relations
The talks with the UAE come as Kenya fosters closer ties with the Gulf nation.
On the same day, Kenya and the UAE signed a comprehensive economic partnership agreement aimed at increasing trade by removing barriers, simplifying customs processes, and encouraging investments.
“Kenya is going to be a gateway for East Africa,” said Thani Al Zeyoudi, the UAE’s minister of trade, emphasizing the potential for growth in bilateral relations.
Trade between the two nations has flourished, doubling over the past decade. The UAE is Kenya’s sixth-largest export market and second-largest source of imports.
Economic Impact of Kenya-UAE Trade
In 2023, trade between Kenya and the UAE was valued at Ksh 445 billion ($3.44 billion).
The UAE purchased agricultural products from Kenya, while Kenya imported petroleum products, machinery, and chemicals.
Kenya is also finalizing a $1.5 billion commercial loan from the UAE for budget support, underscoring the growing financial ties between the two nations.
Energy Collaboration
The UAE’s involvement in Kenya extends beyond trade and railway financing.
In 2023, Abu Dhabi National Oil Company (ADNOC) and Emirates National Oil Company (ENOC) were among three Gulf firms selected by Kenya’s government to supply oil on longer credit terms.
This marked a shift from Kenya’s traditional open tender system and highlighted the UAE’s strategic role in Kenya’s energy sector.
The proposed railway extension and deeper economic partnership with the UAE are set to position Kenya as a critical hub for trade and integration in East Africa. As the feasibility studies progress, the collaboration could pave the way for significant economic growth and enhanced regional connectivity.
