Competition in the transportation of goods between the northern and central corridors is set to intensify with the signing of a memorandum of understanding between Kenya and Uganda, which paves the way for the extension of the Standard Gauge Railway (SGR) to Kampala.

With the completion of the railway line between Mombasa and Kampala, shippers might find it cheaper and more convenient to use the northern corridor as opposed to the central one which has recently witnessed a surge in volumes of cargo using the route.

Shippers argue that what they need is efficiency and cost to determine the route that they will use in ferrying their goods.

“We are interested in two things to determine the route that we need to use. Efficiency and pricing are what informs our choices,” said a Mombasa-based shipper.

Great Lakes countries, who have been key clients at the Port of Mombasa have for many years preferred the northern corridor, however, some of the landlocked neighbours have been shifting cargo to the central corridor as they embrace the port of Dar es Salaam.

The central corridor, which is 1,300km long, begins at the Port of Dar es Salaam and serves Tanzania, Zambia, Rwanda, Burundi, Uganda and Eastern DRC.

On the other hand, the northern corridor, which is 1,700km long, commences from the Port of Mombasa and serves Kenya, Uganda, Rwanda, Burundi and Eastern DRC.

SGR, which will significantly cut down on the number of days that cargo takes in transit with logistics pundits arguing that it could also be cheaper.

The move by Kampala to sign an MoU marks the clearest indication that Uganda, which had for long not shown commitment to the development of its SGR line between Malaba and Kampala, is now ready to complete its section along the northern corridor.

Last Month, Kenya’s Transport Secretary Kipchumba Murkomen and his Ugandan counterpart Wamala Katumba signed the MoU in Mombasa that will see Nairobi extends the railway line to Malaba with the landlocked neighbour constructing it all the way to Kampala.

“We have signed a joint communique after a long meeting between myself and my counterpart from Uganda who is here in the country for bilateral negotiations between the two countries regarding seamless transport of goods by the railway here from Mombasa to Kampala,” said Mr Murkomen.

Uganda announced in May the commencement of construction of the SGR starting August, giving a lease of life for Kenya’s Ksh327 billion project whose viability was dependent on the Ugandan section. Kenya had ended its line in Naivasha for fears that Kampala could not develop the line from the border to its capital.

Uganda says it has secured funds from the Standard Chartered Bank with a Turkish company getting the contract to construct the railway line after Kampala failed to get the money from China.

Earlier, Uganda was looking at China Exim Bank for funds to construct its section of the Malaba-Kampala railway under the northern corridor project that required all the member states to put up a modern railway line in their respective States.

Uganda’s willingness to put up a line from the Malaba border to Kampala was a prerequisite for Kenya to get more funds for the last leg of the railway line that would run all the way to the border town.

In 2014, leaders from Uganda, Kenya, Tanzania, South Sudan and Rwanda broke the ground for the construction of SGR to link the member states with the view of boosting trade in the region.