How the new SGR extension to Kisumu will boost regional trade

Construction for the Standard Gauge Railway (SGR) extension from Naivasha to Kisumu has begun, following a launch by William Ruto in Narok on Thursday.

Phase 2B will cover about 262 kilometres, extending the line to Kisumu.

A further 489 kilometres will be built under Phase 2C to Malaba, with the next phase set for launch in Kisumu this Saturday, March 21.

Ruto described the project as commercially viable, saying delays have cost the country unrealised economic gains.

He said the existing line from Mombasa to Nairobi and onward to Naivasha continues to generate billions of shillings monthly.

"Today, SGR freight operations generate more than Sh1.3 billion every month. Passenger revenue has grown by about 40 per cent, surpassing Sh4 billion annually. In December 2025 alone, passenger revenue reached Sh602 million," said Ruto.

The railway, conceived in 2014, stalled due to budget constraints, delaying plans to link Kenya with regional trading partners, including Uganda, Rwanda, Burundi, DR Congo and South Sudan.

Uganda accounts for about 70 percent of the 7.37 million tonnes of transit cargo handled through the Port of Mombasa.

President Yoweri Museveni is expected to attend Saturday’s launch in Kisumu.

Ruto said the line’s current termination limits its economic impact. "A railway that terminates at Narok is, by definition, incomplete. It does not reach the major production zones of Western Kenya; it does not connect with the lake transport ecosystem in Kisumu; and it does not capture the full volume of outbound freight that sustains a modern rail economy," he said.

The extension is expected to position Kisumu as a regional logistics hub and link agricultural regions in the western region to domestic and international markets.

The Ministry of Roads and Transport says the project will lower freight costs, reduce delays, boost trade and investment along the corridor, and support economic activity around Lake Victoria.

The China Communications Construction Company has been contracted to build the railway line, with completion of the line to Malaba targeted for 2028.

However, the project’s financing model remains unclear. Ruto said “innovative financing mechanisms” would be used to avoid increasing the country’s public debt.

“The naysayers said this is a railway to nowhere. We’ve confirmed to them that we have a plan. We were reorganising ourselves,” said Ruto.

Meanwhile, the National Land Commission and Kenya Railways have begun consultations with affected residents on land acquisition and compensation.