Uganda Railways Corporation (URC) on Monday announced the throwing out Rift Valley Railways (RVR) from management of the metre gauge railway line, marking its exit from Uganda customer and freight market.
URC Managing Director Charles Abooki Kateeba issued a public notice ending RVR’s concession after on grounds that it had failed on all the conditional demands.
Finance minister Matia Kasija, in a January 25 letter to RVR’s executives, had said: “It is clear that there is an absolute failure and refusal to perform or continue with performance of your explicit and critical contractual obligations.”
“All freight and passenger operations that were hitherto being carried out by RVR ltd are now under the control of URC. URC shall not be responsible for any debts, liabilities incurred and, or contracts entered into between RVR and any individual, company, suppliers/contractors or any other third party,” Kateeba said in a statement.
He added that arrangements are underway to restore normal freight immediately and passenger operations by 10th February, 2018.
RVR, the Uganda-Kenya railway concessionaire owned by Cairo-based Qalaa Holdings, has a host of problems; mostly financial and managerial, in the recent past which prompted the governments to start mulling terminating the concession, which was originally set to run until 2030 from 2006.
The railway line is 1,300km from Kampala to Mombasa, with 1,000km in Kenya and 300km in Uganda. As a result Uganda accounts for 75 per cent of RVR revenues while Kenya accounted for 80 per cent of the total costs due to the distance.
