SGR launch heralds economic boon

When the Standard Gauge Railway is launched on June 1, right ahead of schedule, it shall herald a basket of unprecedented socio-economic benefits for Kenya and the East African region.

There is the obvious improvement in the transportation of people and goods between the Port of Mombasa and the hinterland. It will also reduce the cost of doing business, and the prices of goods and services. But most importantly, the SGR also promises to spawn new industries and businesses along the corridor, creating jobs for Kenyans.

Through on-the-job training, technological transfer and institutionalised learning, China Road and Bridge Corporation, the engineering, procurement and construction contractor for the SGR, is preparing the next generation of Kenyan railway workers.

Sixty students are undergoing a four-year undergraduate degree course in railway engineering at Beijing Jiaotong University. Next year, CRBC plans to send the third batch of 40 students.

RAILWAY TRAINING

Locally, 767 students are undergoing railway training at Railway Training Institute (RTI). They include 102, who graduated in July last year and 665 now in session.

This will eventually cover all the 3,000 staff that will be required to operate and maintain the SGR in seven years.

This will ensure that Kenya has a well-trained pool of personnel to operate and maintain the SGR. And in the next phases, Kenya will have ready-to-deploy workers with experience in the construction of an SGR line.

The SGR has proved itself as a veritable creator of jobs, becoming the biggest employer outside government. Some 12,932 staff were on site as of the end of last month.

A significant 11,004 are Kenyans, making up 85.1 per cent of the workforce. Some 1,928 are Chinese managerial and technical personnel, representing 14.9 per cent.

TECHNICAL PERSONNEL

The Kenyan contingent on the project includes 556 managerial staff, 3,505 technicians and 6,943 general workers. Managers and technical personnel make up 36.9 per cent of the local staff.

When you factor in the 5,393 workers employed by local sub-contractors and 3,096 engaged by suppliers, including 1,339 local security personnel and 21,811 workers who have since left, the project has created 42,000 jobs for Kenyans so far.

A critical component in the negotiations between CRBC and the government for the construction of the SGR is the local content element. The concession envisages a certain quantum of local inputs in goods and services is used on the project to build local capacity and benefit host communities.

The CRBC has procured a sizeable portion of its inputs from Kenyan businesses, under this local content requirement, securing for suppliers and sub-contractors a reliable source of revenue.

We have a policy that gives first consideration to local raw materials, where available and meet the necessary specifications. We have signed business pacts with 934 material and equipment suppliers and service providers. We have also engaged 249 sub-contractors.

BILLIONS OF SHILLINGS

When you plug in the multiplier effect, this has been tremendous in creating and fortifying jobs, while boosting supply chains. By the end of February, local content equivalent to a couple of billions of shillings had been implemented.

The biggest beneficiaries of local content buying, include cement and steel manufacturers, fuel vendors, and timber merchants.

As the project enters the next phase, more suppliers and sub-contractors are expected to benefit. We see opportunities in the building of the next phase and the establishment of ancillary industries.

These include the revamped dry port at Embakasi, Nairobi, and the proposed SEZ (Special Economic Zone) in Naivasha.

The CRBC is implementing the integrated commissioning and acceptance inspection stage. We feel honoured to have been tapped to execute a project of such a grand ambition and scale.

STRUCTURAL INFRASTRUCTURE

We look with pride at what has been achieved in the first such green-field project since the Kenya-Uganda railway of the early 1900s. But its value lies beyond the enormity of the iconic structural infrastructure.

This landmark project is a child of cooperation between Kenya and China.

The SGR has bolstered an age-old socio-economic contact between the two countries and given it an enduring, sustainable symbol.

No image represents this dynamic better than that of a Kenyan employee working alongside his Chinese counterpart, and gaining from a pool of experience and technical know-how.

The skills assembled, some very precise and technical, will be useful to them and the country for their entire working lives and posterity.

Mr Zhao is the head of external relations and cooperation at CRBC