Cost Estimate

• Costs for construction of LAPSSET Corridor Railway and procurement of rolling stocks are estimated at approximately US$ 7,100 million in total, including civil works US$ 3,480, tracks US$ 1,200, rolling stock US$ 1,220, signal and telecom US$ 520, buildings USD$ 300, and others in million.

Economic Evaluation

• The Railway has overall Economic Internal Rate of Return (EIRR) of 15.6% for all sections combined. The project is considered feasible from the viewpoint of national economy.

Financing Plan

1. In consideration of the past experience of failure in concessioning the existing railways in Kenya,  government  involvement  for  the  initial  capital  investment  for  the  LAPSSET Corridor railway will be indispensable, because the cost is huge.
2. Another important fund raising method is to procure funds not only from multi-lateral and bi-lateral sources such as co-financing, but also from the beneficiary countries of the Corridor, i.e. Southern Sudan and Ethiopia.
3. The PPP scheme could be applied, whereby the private sector participates in management and operation of the railway with adequate expertise and financial capacity based on lease contract of the infrastructure with the government.