Tunisia: €160 million cash boost for domestic rail network

Efficient transport links and in particular railways, have long been recognised as a key driver of economic development in countries across the globe. Transport links between nation states are important be they via ports, airports, railway or highway but the efficiency and accessibility of internal domestic links are equally vital for the smooth running of a proficient domestic economy.

Recently the European Bank for Reconstruction & Development (EBRD) has approved a loan which will see the upgrade and renovation of two key routes in Tunisia’s railway infrastructure. Funds will be used to enhance the network’s capacity and performance, providing a safer and more reliable service to thousands of passengers across the Arab/North African state.

 A €160 million loan from EBRD will help Société Nationale des Chemins de Fer Tunisiens (SNCFT) to create additional capacity on the railway network to address overcrowding on trains and to improve service reliability and quality The financing will contribute to the upgrade and realignment of the existing Tunis-Kasserine railway line, improving the connection between the two cities and enabling the flow of goods, services and people across the rail network, contributing to better integration between the country’s North West and Centre West governorates and the capital city of Tunis.

 In line with the EBRD’s green economy policy, a number of measures will be employed to address the growing number of passengers in the increasingly urbanised areas served by the central coastal railway line of Tunisia which will also have energy saving benefits.

Meanwhile, the Suburban Southern coastal (Sahel) rail line between the towns of Moknine and Mahdia will be extended and electrified, and the purchase of six modern electric trains will contribute to energy savings and the reduction of carbon emissions by as much as 14,000 tonnes annually. As an added benefit, it is estimated that an improved railway service will help decreasing vehicle traffic on Tunisia’s highway network by 10 million vehicles per kilometre per year by 2021.

 A  corporate development programme will also be introduced to support SNCFT in its railway restructuring efforts and in implementing measures to improve its financial sustainability and operational efficiency, while a technical cooperation package will support procurement arrangements, a corporate development scheme, preparation of a network development strategy and support required environmental and social measures.

Ziad Laadhari, Tunisian Minister of Development, Investment and International Cooperation, noted: “This project forms an integral part of the overall development strategy for the railway sector, particularly in the region of Kasserine, and is fully aligned with the country’s strategic orientation towards the development of infrastructure in inland regions. This will help achieve regional integration, strengthen the economy and improve the quality of life for the inhabitants of these regions.”

 Since the EBRD began operations in Tunisia in September 2012, the Bank has invested over €390 million in over 27 projects in the country. Its investments aim to support the restructuring and strengthening of the financial sector and financing private enterprises, supporting energy efficiency and developing a sustainable energy sector as well as facilitating non-sovereign financing for infrastructure development. The EBRD’sTransition Report 2017-18 predicts the Tunisian economy will grow by 2.2 per cent in 2017 and 2.8 per cent in 2018.

 SNCFT is the national railway company created in 1969 to manage and operate the railway network in Tunisia reporting to the Ministry of Transport (MoT). SNCFT is an integrated railway entity carrying passengers and freight. It operates a network spanning 2,165 kilometres, with 267 stations and four railroad connections across the country.

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