The Standard Gauge Railway (SGR) experienced a significant decline in both passenger numbers and cargo volumes in the first quarter of 2024, according to the Quarterly Gross Domestic Product (GDP) Report released by the Kenya Bureau of Statistics (KNBS) on Wednesday, July 2024.
The report indicates that the transportation and storage sector’s real GDP growth decelerated to an estimated 3.8% in the first quarter of 2024, compared to 6.6% growth in the same period in 2023.
Passenger and Cargo Volume Declines
The number of passengers transported via SGR dropped by 11%, from 597.5 thousand in the first quarter of 2023 to 531.7 thousand in the same period in 2024. Similarly, freight haulage via SGR decreased by 17.4%, from 1,577.9 thousand metric tonnes in the first quarter of 2023 to 1,303.3 thousand metric tonnes in 2024.
Marginal Revenue Increase
Despite the decline in cargo and passenger volumes, SGR saw a marginal increase in revenue, attributed to a 50% ticket price hike introduced in January 2024. Revenue from the freight stream rose slightly from Ksh3,140 million in the first quarter of 2023 to Ksh3,245 million in the corresponding quarter of 2024.
Port of Mombasa Throughput Increase
In contrast, the Port of Mombasa recorded a 7.3% increase in throughput, from 8,792 thousand metric tonnes in the first quarter of 2023 to 9,430 thousand metric tonnes in the first quarter of 2024. The SGR relies heavily on cargo from the Port of Mombasa to sustain its operations but faces competition from other logistics companies, including trucks and the metre gauge railway line.
Future of SGR
The SGR line, constructed under former President Uhuru Kenyatta’s administration with a loan from China amounting to Ksh800 billion, continues to face operational challenges. Despite these struggles, President William Ruto’s administration has expressed a willingness to borrow additional funds to extend the SGR line from Naivasha to the Ugandan border.
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