Total Project Cost
Investment Required
Stakeholders
Countries
Project Overview
Description
Construction of a standard gauge railway as part of the Lamu Port-South Sudan-Ethiopia Transport (LAPSSET) Corridor to enhance regional connectivity between Kenya, Ethiopia, and South Sudan. This transformative rail project will establish a 2,900 km railway network connecting Lamu Port on Kenya's coast to Ethiopia and South Sudan, creating a vital transportation backbone for the region. The railway will feature modern standard gauge technology with capacity for both freight and passenger services, linking major economic centers and providing landlocked countries with efficient access to maritime gateways.
Objectives
Establish a modern, high-capacity railway network connecting the new Lamu Port to Ethiopia and South Sudan, enhancing regional connectivity and reducing transportation costs; provide landlocked countries (South Sudan and Ethiopia) with efficient and reliable access to maritime facilities; stimulate economic development along the corridor through improved logistics and market access; support industrialization and resource development by enabling efficient transport of bulk commodities; enhance regional integration through standardized rail infrastructure and operations; reduce road congestion and maintenance costs on parallel highway corridors; lower carbon emissions through efficient electric rail transport where feasible; and create substantial employment opportunities during both construction and operational phases.
Strategic Importance
The LAPSSET Railway Project represents a cornerstone of East Africa's transportation infrastructure development strategy, aligning with both national development plans and regional integration goals. As a key component of the broader LAPSSET Corridor Program, the railway will serve as an economic lifeline for the region, opening up previously isolated areas to development and providing a critical alternative to the congested Northern Corridor. For South Sudan and Ethiopia, the railway offers a strategic alternative access to the sea, reducing dependence on existing routes and strengthening regional resilience. The project directly contributes to multiple African Union Agenda 2063 aspirations, particularly regarding regional integration, infrastructure development, and inclusive economic growth. By establishing efficient logistics connections, the railway will significantly enhance trade competitiveness, support industrialization, and facilitate greater participation in regional and global value chains. Additionally, by shifting freight from road to rail, the project contributes to climate change mitigation through reduced carbon emissions and decreased environmental impacts from heavy road transport.
Technical Specifications
Technology & Design
The project will employ standard gauge railway technology with modern signaling and control systems. Design standards will be harmonized across the three countries to ensure interoperability and efficiency. Key design elements include electrification potential (initially diesel with provision for future electrification), advanced train control and communications systems, climate-resilient infrastructure elements, and intermodal terminals at key locations.
Capacity & Size
The railway network will extend approximately 2,900 km across the three countries: Kenya segment: 1,200 km; Ethiopia segment: 1,100 km; South Sudan segment: 600 km. Design capacity includes freight operations of up to 25 million tons annually and passenger capacity of 12 million journeys per year. Maximum train speeds of 120 km/h for passenger service and 80 km/h for freight are planned.
Technical Details
Standard gauge railway (1,435mm) with axle load capacity of 25 tons; Minimum curve radius of 800m on main lines; Maximum gradient of 1.2% (compensated); Diesel traction initially with provision for future electrification; Modern signaling and train control systems (ERTMS Level 2 where feasible); Double track capability with initial single track construction in most sections; Major bridges designed for 120-year lifespan; Tunnels with standard cross-section of 60 square meters; Stations designed for future capacity expansion
Development, Implementation & Financial Details
Development Timeline
Kenyan segment: Feasibility completed 2022, detailed design 2023-2025, financing 2025-2027, construction 2027-2032; Ethiopian segment: Pre-feasibility ongoing 2022-2024, feasibility 2024-2026, detailed design 2026-2028, financing 2028-2030, construction 2030-2038; South Sudan segment: Needs assessment 2022-2025, pre-feasibility 2025-2027, feasibility 2027-2029, detailed design 2029-2031, financing 2031-2033, construction 2033-2043
Latest Implementation Updates
UPDATED2025-03-25 — Independent regional policy brief highlights renewed 2025 momentum on LAPSSET rail sequencing and financing outreach; positions SGR as backbone for the corridor's trade strategy. Link: https://aaeafrica.org/east-africa/the-lapsset-corridors-transformative-role/
Financing Structure
The project will utilize a blended financing approach with significant public investment supplemented by private sector participation. Funding sources include: sovereign lending from multilateral development banks (AfDB, World Bank); bilateral development finance from partner countries; national budget allocations from participating governments; private capital through PPP arrangements for rolling stock and operations; and climate finance for low-carbon transport components. Technical assistance grants are being secured for project preparation phases.
Capital Structure
Base infrastructure (65-70%): Public financing through sovereign loans and grants; Operations and rolling stock (30-35%): Private sector investment through concession arrangements or PPPs; The exact financing mix will vary by segment, with commercially viable sections attracting higher private participation.
Project Timeline
Start Date
January 2012
Expected Completion
December 2043
Development Timeline
Kenyan segment: Feasibility completed 2022, detailed design 2023-2025, financing 2025-2027, construction 2027-2032; Ethiopian segment: Pre-feasibility ongoing 2022-2024, feasibility 2024-2026, detailed design 2026-2028, financing 2028-2030, construction 2030-2038; South Sudan segment: Needs assessment 2022-2025, pre-feasibility 2025-2027, feasibility 2027-2029, detailed design 2029-2031, financing 2031-2033, construction 2033-2043
Project Status History
Status 2020
Pre-Feasibility
Status 2022
Pre-Feasibility
Status 2024
Pre-Feasibility
Additional Project Details
Preparation Funding Gap
USD 45.00M
Construction Timeline
Implementation will follow a phased approach: Phase 1 (Lamu-Isiolo, Kenya): 2027-2032; Phase 2 (Isiolo-Ethiopian Border): 2029-2035; Phase 3 (Ethiopian Internal Network): 2030-2038; Phase 4 (Isiolo-South Sudan Border): 2032-2037; Phase 5 (South Sudan Internal Network): 2033-2043
Legal & Financial Advisors
PricewaterhouseCoopers and CPCS Transcom providing transaction advisory services; legal advisory services by multiple firms including ALN Advocates
Market Analysis
Market Analysis
Freight demand analysis indicates significant potential for bulk cargo transport, particularly for extractive industry outputs, agricultural products, and manufactured goods. Current regional freight transport is dominated by road with high costs and unreliability. The Kenya-Ethiopia trade corridor alone handles over 1.5 million tons of cargo annually, with projections showing growth to 3.5 million tons by 2030. Similar growth trends are expected for South Sudan trade flows once political stability is achieved. Passenger transport demand is estimated at 10-12 million journeys annually by 2035 based on regional demographic and economic growth projections.
Market Demand
The railway will serve regions with a combined population of over 275 million people (Kenya, Ethiopia, South Sudan and neighboring countries). An estimated 40+ million people live within the direct influence zone of the corridor. Annual freight capacity is designed for 25 million tons with passenger capacity of 12 million by 2040.
Key Stakeholders
Project Sponsor
Ministry of Transport of Kenya, Ethiopian Railways Corporation, Ministry of Transport of South Sudan
Key Parties
Ministry of Transport of Kenya, Ethiopian Railways Corporation, Ministry of Transport of South Sudan, LAPSSET Corridor Development Authority (Kenya), IGAD Secretariat
Investors
African Development Bank, World Bank, China Exim Bank, European Investment Bank, USAID, UKAID, JICA
Contractors & Operators
To be determined through international competitive bidding following project structuring and financing
Risk Assessment
General Risk Assessment
Key risks include: variable implementation capacity across the three countries; complex cross-border coordination requirements; financing challenges for certain segments; security concerns in some regions; land acquisition complexities; technical challenges in difficult terrain; climate change impacts on infrastructure; and potential delays in complementary infrastructure development. Risk mitigation strategies include phased implementation approach, comprehensive stakeholder engagement, robust governance frameworks, and technical capacity building initiatives.
Regulatory Risks
Requires harmonization of railway regulations, technical standards, customs procedures, and border management protocols across three countries with different legal systems and institutional frameworks. The development of a Corridor Management Authority is proposed to coordinate cross-border issues. Key regulatory risks include delays in establishing necessary legal frameworks, inconsistent implementation of standards, and governance challenges in cross-border railway operations.
Impact Assessment
Environmental Impact
The project will require comprehensive Strategic Environmental and Social Assessments for the entire corridor and segment-specific Environmental and Social Impact Assessments. Key environmental considerations include: habitat fragmentation in ecologically sensitive areas; management of excavation materials in mountainous sections; water resource protection; climate resilience measures; and potential impacts on wildlife migration routes. Extensive mitigation measures will be implemented, including wildlife crossings, erosion control systems, and habitat restoration initiatives.
Social Impact
The railway is expected to generate over 60,000 direct jobs during construction and 25,000 permanent jobs during operation. Broader socioeconomic benefits include improved market access for agricultural producers, enhanced urbanization patterns around station areas, increased property values along the corridor, reduced transportation costs for consumers and businesses, new tourism development opportunities, skills development in railway operations and maintenance, and improved access to social services through enhanced mobility. Special provisions will be made for affected communities through robust Resettlement Action Plans and community benefit-sharing mechanisms.
Investment Opportunities
Private Sector Opportunities
Significant opportunities exist for private sector participation in railway operations and maintenance, rolling stock provision and maintenance, station commercial development, logistics facilities, training and capacity building, and digital systems development. The PPP frameworks being developed will provide specific structures for each project component, with opportunities for both international and local private sector partners.
Next Steps & Agreements
Next Steps
Complete comprehensive feasibility studies for all segments; secure technical assistance funding for detailed designs; establish corridor coordination mechanism; finalize environmental and social impact assessments; develop PPP frameworks for operations; initiate capacity building for railway management; secure financing commitments
Offtake Agreements
Inter-governmental agreements between the three participating countries will establish consistent operational protocols, technical standards, and border crossing procedures. Framework agreements for private operators will include performance-based metrics for service quality, maintenance standards, and system reliability.
Contact Information
Eng. Peter Mungai, Director of Railway Development, Ministry of Transport (Kenya), Email: railway@transport.go.ke, Tel: +254-20-2729200; Dr. Tilahun Sarka, Director General, LAPSSET Corridor Development Authority, Email: info@lapsset.go.ke; Garba Sani, Senior Programme Officer, Transport Infrastructure AUDA-NEPAD, Email: garbas@nepad.org
