Why Nanyuki railway makes economic sense

As a key proponent of revival of the Nanyuki railway, let me debunk a few myths, some most recently perpetuated by George Wachira, in his Business Daily column on March 4.

Mr Wachira argued against the revival of the Nanyuki line, quoting primarily irrelevant history and the need to protect the trucking business.

Being a petroleum consultant, Mr Wachira should know better the significant public safety benefit of moving petrol on the rail rather than by road. Heaven forbid another Sachagwan! If for no other reason, it makes sense to revive the rail so that petroleum products are moved into the region more safely.

Two, one would certainly hope that Mr Wachira understands the economic sense of moving large amounts of fuel, not just to Mt Kenya region, but onwards to South Ethiopia, fully or partially on the rail. We expect the transport cost savings to translate to better pump prices. Not to be uncharitable, but perhaps that is why consultants get a poor reputation!

That out of the way, I offer five solid reasons why the Nanyuki railway makes sense. These are improving logistics for the central region economy; linking the upcoming Lappset development corridor to the existing one; stimulating mining in Laikipia, Isiolo, Meru and Tharaka-Nithi; moving fuel safely at reduced cost to the region and beyond; and improving public transport and commerce. Let us examine each one in turn.

At $27 billion, the central region economic bloc is today one of the most significant economies within East and Central Africa. In a matter of fact, it is larger than Burundi, South Sudan and Rwanda, to name a few. It is diverse, but agriculture is predominant throughout, accounting for 52 percent of the total.

Although Mr Wachira seems to think that agricultural production disappeared with the colonialists, it is thriving. At just over $11 billion (in year 2007, see chart below), it is larger than the country’s total economy at independence! The composition of agriculture is also telling. Milk and beef continue to be important, particularly for Laikipia, milk and potatoes for Nyandarua and horticulture and floriculture for all three — Laikipia, Nyandarua and Nakuru.

So moving agricultural inputs such as fertiliser to Laikipia, Isiolo, Meru, Murang’a, Tharaka Nithi, Kirinyaga, and so on, and taking produce to market remains a viable proposition for the railway. As any economist will tell you, properly functioning logistics is a crucial enabler of any vibrant economy.

Kenya’s current spatial distribution of economic activity follows the original transport corridor, running from Mombasa through Nairobi to Kisumu and Malaba and onwards to Kampala.

That is part of the reason we expect the Lappsset corridor will generate a whole new development corridor, running from Lamu through Isiolo north-west towards South Sudan and northwards from to Ethiopia. As this corridor develops, there is immediate need to connect it to the existing Mombasa-Uganda corridor. This is because the Lamu Port is already partially functional and the road link to Isiolo under construction and some areas already motorable. Reviving the current metre gauge achieves that objective immediately.

Laikipia, Isiolo, Meru and Tharaka-Nithi have large amounts of iron ore and other industrial mineral deposits. This is the time to move to commercial exploitation these minerals as a basis of achieving the manufacturing pillar of the Big Four Agenda.

A revived Nanyuki line is crucial for the early development of that mining. This is so because key markets within the central region for the nascent iron ore mining are in Kiambu and Nakuru.

Vivo Energy recently invested in an 11.5 million-litre depot in Nanyuki. Why? Because the fast growing town is a perfect logistics hub for the Mt Kenya region and for northwards all the way to southern parts of Ethiopia.

So contrary to Mr Wachira’s assertion that we should favour trucks for the door-to-door delivery of fuel products in the region, moving fuel in bulk to Nanyuki is the more logical and economically useful option. From Nanyuki we can use trucks to serve the region.

The Nanyuki line is already functioning from Nairobi to Mitubiri in Murang’a County. Between Nairobi and Ruiru, the line is already part of the public transport system of the Nairobi metropolitan.

There is no reason why this should not extend to Sagana. In the modernisation of this segment, the Kenya Railway has provided modern stations, and get this, markets and parking lots alongside the stations. The effect is dramatic stimulation of commercial activity, with the stations becoming centres of such activity.

We expect to see the same in Sagana, Karatina, Chaka, Narumoru and Nanyuki. Take the cases of Chaka, as well as Karatina where commercial activities are evident all along, nay I should say on the railway line. This is what gave rise to the conversation about relocating traders in both towns. Obviously part of the rehabilitation of this line includes providing the necessary working spaces for traders. A new station is expected at Chaka.

So revival of the Nanyuki railway line makes perfect economic sense.

Mr Muriithi is the governor of Laikipia County.