Kenya Railways has signed a contract with China Communications Construction Company (CCCC) for the construction of the Naivasha-Malaba Standard Gauge Railway line under the Kenya SGR Developments Project valued at KES549bn ($5.4bn).

A protocol for the development of a standard gauge railway connecting the port of Mombasa to Kampala, Kigali and Juba was signed and ratified by Kenya, Uganda, Rwanda and South Sudan.

Kenya is developing the Mombasa-Malaba section of the entire proposed network to Kigali through Uganda. Construction on the Mombasa to Nairobi section is at an advanced stage.

The commercial contract will include four elements: the Naivasha-Kisumu section; Kisumu Malaba section; Kisumu Port Development; and modernisation and expansion of the Inland Container Depot (ICD) at Embakasi in Nairobi.

The contract will allow the two companies to jointly conduct a feasibility study for the Nairobi to Malaba section of the project; facilitate transfer of technology; and create skills and capacity for construction, maintenance and operation of the railway upon completion.

The Kenyan government has secured a $1.5bn loan from the Chinese government to support the development of Phase 2A between Nairobi and Naivasha. Construction on the project will begin by the end of 2016.