Kenya and Ethiopia sign pact for railway development between Lamu Port and Addis Ababa

In 2012, Kenya and Ethiopia signed a bilateral agreement for the Development, Operation and Management of a Standard Gauge Railway (SGR) linking the port of Lamu in Kenya with Addis Ababa, passing through the city of Isiolo and the border town of Moyale, where a One Stop Border Post (OSBP) commenced operation in June 2021. The railway, whose construction works are set to begin in 2025, will also include a link from Isiolo to Nairobi that will intersect the Mombasa-Nairobi-Malaba SGR, and one to South Sudan via the border town of Nakodok, for a total lenght of about 3,000 Km. Recently, the two countries also agreed to establish a Bilateral Steering Committee to fast-track the development of the LAPSSET Corridor and its supporting infrastructure.

During an interview for Capital FM News, the Cabinet Secretary for Roads, Transport, and Public works of Kenya announced that the road connecting Lamu to Garissa and Isiolo, about 538 Km. long, is currently in the process of being tarmacked, with works that are ongoing, even if slowly. By the end of January, only 43 percent of the road was completed, with the contractor that has delayed on several occasions the construction works due to increased attacks on workers by Al-Shabaab.

The Lamu-Isiolo road will intersect other two sections of the LAPSSET corridor (the corridor project that is supposed to grow integration in East Africa), branching out from there to South Sudan and Ethiopia, as shown in the picture below.

Recently, a delegation guided by the Ministry of Transport and Logistics of Ethiopia visited Lamu to see the work progress at the port, which become operational on 20 May 2021. Ethiopia is incessantly looking for alternative ports to reduce its dependance on Djibouti, which despite being its best option in terms of geographical proximity, maritime connectivity and infrastructural development, has also prohibitive operation costs that are due to various factors, including the cost of electricity in the country, which is among the highest in the Horn of Africa (ports are energy-intensive facilities).

Moreover, recently, a study made by the Ethiopian Logistics Sectoral Association revealed that freight trucks transporting cargo across the Djibouti corridor face huge maintenance and repair costs due to damages and breakdowns caused by the bad conditions of the road. In addition, road safety concerns, illegal inspections and harassment practices further complicate the situation. Because of this, increasing volumes have recently been shifted by Ethiopian traders to the Berbera port, in Somaliland.

According to a report presented in January 2022 by the former Ethiopian Minister of Transport to a specialized Committee of the Parliament, in the second half of 2021, the volume of Ethiopia trade channeled through Djibouti decreased significantly from 95 to 83.9 percent, with Berbera that was handling 5.9 percent of this traffic.

Being a landlocked country, Ethiopia heavily depends on its neighbors’ ports for trading with most of its trade partners, with the current port utilisation costs that have been recently defined by the Ethiopian Prime Minister as ‘unsustainable’ for the country.