Monday April 22 2013

Completion of the Tororo-Pakwach railway line will promote business

By Isaiah Rwanyekiro

The Minister of Finance Maria Kiwanuka recently revealed during a budget strategy consultative workshop at the new Office of the President that expansion of production of goods and services and consequently, income to every Ugandan will be the focus of the next budget.

She added that while there has been a remarkable improvement in infrastructure development, a mismatch between the pace of investment in new infrastructure and demand, is leading to a growing infrastructure deficit.

To graphically illustrate this deficit, it is estimated that the traffic forecast for both the northern corridor (Mombasa-Malaba-Kampala-Gatuna-Kigali-Bujumbura) and central corridors from Dar-es-Salaam through Tanzania-Uganda-Rwanda and Burundi will soon overwhelm current capacity.

According to various studies, demand on the major routes (highways, ports and railways) will increase four-fold from 24 million tonnes in 2015 to 100 million tonnes in 2030. In this regard, Ms Kiwanuka promised that the government will continue to ensure timely provision of quality infrastructure to support productivity growth in both the private and public sectors and accelerate growth.

To this effect government wants to boost investments in the rail sector by commencing work on the railway project which will connect Uganda to the Tanzanian port in Dar-es-Salaam. This will be a strategic alternative to the Kampala-Mombasa route which currently is overwhelmed by cargo. Tanzania has agreed to passing Uganda’s cargo through Dar-es-Salaam within seven days of arrival. This process will involve constructing a 668-kilometre standard gauge, a 1.4–metre line from Arusha, bypassing the Serengeti National Park to Musoma and then to the New Kampala Dry Port in Bukasa.

Work on the New Kampala Port will commence in the new financial year in preparation for the upgrade of the Uganda Railway well knowing city destinations like Goodshed yard in Kampala and Port Bell ports are now heavily congested. For example, Port Bell can only handle one million tonnes of cargo per annum yet the New Kampala port in Bukasa will be able to handle eight million tonnes of cargo.

The announcement came against the backdrop of another equally refreshing revelation that the 500km Tororo-Pakwach railway will be completed in August. Rift Valley Railways (RVR) has indeed confirmed that the ongoing repairs on the Tororo-Pakwach line will be complete before the end of August. The completion of the repairs is expected to boost business between Mombasa, Malaba, Tororo, Mbale, Kumi, Soroti, Lira, Gulu and Pakwach as traders will have a direct and cheaper alternative to transport their goods.

The revival of this line is important as it now opens an alternative to the Northern road corridor connecting vital trade routes strategically with South Sudan, which is now becoming a major target for business transactions in the region. Revitalising this line is timelier now that northern Uganda has achieved total peace.

In comparison with our most strategic neighbours, we note that though Kenya is a big country, nearly 75 per cent of the country’s population lives in a straight line- a distance of about 100 kilometres on either side of the Kenya-Uganda Railway and the Mombasa Road from the coast to the Uganda-Kenya border. This allowed Kenya to relieve the rural areas for agriculture and deliver goods to market, much more efficiently than Uganda and Rwanda.

With the discovery of huge oil deposits in West Nile and around Pakwach area and with the easing of transport through the railway line, we can expect Pakwach in a few years to get on a road to unprecedented growth. Already, a friend who hails from that region tells me that the Pakwach of today is totally different from the Pakwach of yesterday.

Ever since Total and China National Offshore Oil Corporation (CNOOC) got oil prospecting licences in the Pakwach-Nebbi area, life has never been the same. Today small housing units that used to be rented out for a monthly fee of Shs70,000 are now being paid for daily at a rate of Shs70,000 per day bringing this to a total of Shs2.1million. This translates to a 100 per cent revenue increment.

Today, night life is booming in Pakwach and a lot of business is going on there. Restaurants, local food demand, health services, insurance to mention but a few are booming. I therefore think the strategic decision to extend railway services to Pakwach was a very wise one because it will bring developments in small towns as more people will participate in providing social services to the traders.

Ninety per cent of Uganda’s major towns and trading centres were formerly railway station stops. Today they are bustling business hotspots. One of the advantages of rural urbanisation is that in the long run, it relieves the rural areas of the populace hence leaving land free for commercial agriculture to take place.
In short, the railway transport system is a tool that makes boundaries useless limitations and hence internationalises trade and makes a firm connection between the sea and dry land.