Rift Valley Railways to receive $40m loan from AfDB
15 July 2011
The African Development Bank (AfDB) has agreed to show its support to the Rift Valley Railways (RVR) transport infrastructure project by providing a loan worth $40 million (£24.85 million).
This will help the $246 million initiative, which will see a rail network from Kenya's Mombassa to Uganda's capital Kampala built in an attempt to improve transport links between the countries.
It is expected to take five years to construct and once the RVR is in operation, the AfDB hopes the railway will boost freight transport, as goods will increasingly be carried by train rather than by road.
By 2015, the organisation anticipates that the volume of products transported between the two nations will more than double, while the cost of manouvering the goods is expected to fall by a third.
The AfDB is keen to give its support to the RVR as the railway is more than 100 years old and, as a result, only eight per cent of goods are typically carried on trains.
Uganda also recently received a $60 million loan from the financial institution to be used to improve transport infrastructure within the country in order for its rural population to have better access to towns, which should open up market places.