Billion dollar railway goes to Chinese company


The 340 Km, 1.435 meters wide standard single track Me’eso-Dire Dawa- Dewale electric railway turnkey project was signed between the Ethiopian Railway Corporation and the Chinese state owned enterprise China Civil Engineering Construction Corporation (CCECC) on December 16 at the Addis Ababa Hilton Hotel. On average each kilometer of rail line will cost about USD 3.5 million.
The total project is expected to cost about 1.2 billion dollars out of which 40 percent is covered by the government of Ethiopia in local currency while the additional 60 percent is expected to be financed from China through a soft loan.
The Me’eso-Dire Dawa- Dewale electric railway project is divided into three lots with the first lot of 137 Km Me’eso- Dire Dawa project that is designed by a local company, Transport and Construction Design Share Company.  The second lot of 101 Km Dire Dawa- Adi Gala is designed by Metaferia Design and Consultancy Company and Spice Designing and Consultancy Company, while the third lot, 102 Km Adi Gala- Dewale is designed by Gondwana Engineering and Consultancy Company.
Doctor Engineer Getachew Betru General Manager of Ethiopian Railway Corporation (ERC) said electric railways were chosen because they are on average six times cheaper than diesel powered railway.
The Project is part of the 656Km Addis Ababa-Me’eso- Dire Dawa- Djibouti line. The projects first lot of 317 Km Addis Ababa- Me’eso railway line, is awarded to the Chinese company China Railway Eryuan Engineering Group Co. Ltd. (CREEC).
The last part of the rail, which stretches 100 Km from Dewale to Doraleh Container Terminal is going to be undertaken by the government of Djibouti.              
The future Ethiopian National Network of railways is going to have eight railway routes in the four corners of the country with a length of 5,060Km. The Ethiopian government plans to construct more than 2000 Km of rail lines during the five year GTP program. 

Addis-Ababa/Sebeta/- Mojo- Dire Dawa- Dewale line, the Mojo-Shashemene- Arba Minch-Weyeto-Moyale line, the Sebeta- Ejaji-Jimma- Tepi line, and the Ejaji-Nekempt-Assosa-Kurmuk line. It also includes the Awash-Woldiya-Mekele-Shire line, Finote Selam- Woreta- Woldiya- Elidar line, the Woreta- Azezo- Metema line and the Adama- Endeto- Gasara line.
CCECC President Yuan li said his company has been involved in rail projects in other African countries such as the Tanzania-Zambia rail project. CCECC also has projects in Turkey, Saudi Arabia, Algeria, Sierra Leone and Nigeria which are quite similar to the project the company was awarded in Ethiopia.
“10 years ago I came to Ethiopia and discussed the project with ERC officials and travelled extensively across the country. After 10 years the discussion had come into fruition,” Yuan said.     
CCECC is a large scale state owned enterprise established in 1979 with Chinese National Super Grade qualification for project contracting and has over the last three decades expanded its business scope from international contracting for railway construction to civil engineering design and consultancy.
It is also involved in the real estate development, industrial investment and hotel management as well spreading over 40 countries.
An ERC official said the 339Km Me’eso-Dire Dawa- Dewale project is expected to displace a very small number  of people which is minimal as compared with the projects benefits.