Putting the Maghreb railway back on track

04 September 2008
With the cost of air travel soaring, Cairo, Tripoli and Algiers are finally taking steps to overhaul their dilapidated railway infrastructure after years of underinvestment.

Unlike Saudi Arabia, where three huge projects are set to give much of the kingdom a rail connection for the first time since the Hejaz railway at the beginning of the 20th century, North Africa has a legacy of rail from colonial times.

However, much of that legacy has been squandered over the subsequent decades of underinvestment, to the point where national rail networks have largely fallen into disrepair or been abandoned completely.

The region’s governments have now woken up to the fact that without functioning passenger and freight links around the country, their national rail infrastructure network is in danger of being permanently consigned to history.

The high cost of air travel means it is out of reach for many, and fares are rising as fuel prices soar. Rail investment is back in the spotlight.

Morocco already has good rail infrastructure, and its programme to upgrade its existing network to provide high-speed links between the kingdom’s major cities will bring the network up to the best of modern standards.

Tunisia too boasts impressive road and rail links between its main cities, and the small size of the country makes further upgrades relatively straight-forward, so long as there is money to invest.

But in the larger states that lie between the two countries, it is a different story. The old rail networks in Libya and Algeria have fallen into disuse, while Egypt’s 5,000-kilometre network is poorly maintained and has a poor safety record.

Rebuilding plans

All three countries are now trying to turn the situation around. In February, Russian Railways was awarded a contract to build a modern rail transport hub in the Algerian capital Algiers.

The project covers the rebuilding and upgrading of 14 suburban stations, the dismantling of 58.5km of existing tracks and laying about 95km of new line, the electrification of 52km of track, and associated works including a 38km telecommunications system and the construction of a modern rail control centre.

Libya, which has had no railway in operation since 1965 after the old narrow-gauge system fell apart in the years following the Second World War, is now capitalising on its substantial oil wealth to build a multi-billion-dollar network from the roots up.

“We have no rail in Libya, not even one metre,” says one official at the government’s Railway Executive Board (REB). “We need new railways to develop the economy of the country.”

Libya’s readmission into the international community has prompted a new impetus to improve the country’s tourism infrastructure.

There are plans for a railway running the entire length of Libya’s Mediterranean coast, from Tunisia to the Egyptian border.

This year alone, it has taken several huge steps forward. Earlier this year, China Railway Construction (CRC) and Russian Railways were awarded the two construction packages on the $4bn high-speed rail project along Libya’s Mediterranean coast.

The Chinese will build a double-track, high-speed line between Khoms and Sirte, while the Russian firm will continue the line to the country’s second city, Benghazi.

CRC will also build a $1bn, 800km minerals railway running north to south between the mines near Sebha and Misurata on the coast. Once the line is complete, products will be transported rapidly and in bulk.

As with the North-South railway in Saudi Arabia, the line should dramatically increase the speed and capacity of the country’s minerals export business.

Improving trade

The new network “will improve trade links to Tunisia and Egypt and the minerals railway will improve industry in the country,” says the REB official.

“We want to bring more tourists to the country and the railway from Tripoli to Benghazi means they can travel along the coast.”

The proposed extension of the high-speed track from Khoms to the capital is still in the design phase, but the REB says it hopes to issue a construction tender for this package by the end of the year.

With France’s Aeroports de Paris starting work on a $1.3bn refit of Tripoli International airport, Libya is at last building an integrated transport system to support the country’s embryonic economic redevelopment and diversification plans.

However, questions remain over whether Libya has sufficient engineering expertise within the country to plan and roll out this network.

“Libya, like the Gulf, has a lot of money at the moment,” says an official at one Western contractor closely involved in the North African market.

“What it has not got is the level of expertise to deliver on projects of that kind at the moment.”

However, there are factors that work in Libya’s favour.

“Tripoli to Benghazi is mostly flat stony desert, so it should be fairly easy to deliver,” says the contractor.

“If they hand these projects over to foreign contractors on a turnkey basis, it is possible they could bring that expertise in.”

The REB is aware of its skills shortage and has issued a tender to find an international consultant to supervise construction on each of the rail packages under way.

The companies appointed will work alongside Germany’s De-Consult, which has been working closely with REB for the past four years.

“We would like to bring in three consultants, one for each project: Khoms to Sirte, Sirte to Benghazi and Sebha to Misurata,” says the official.

Sourcing finance

The REB hopes to appoint a separate consultant for each of the three sections of the rail project by early November.

Another tender was issued in early August for the design of a 450km, high-speed line between Benghazi and Tobruk, close to the Egyptian border, which is likely to cost close to $2bn.

Unlike the billions being spent across the border in Libya, Cairo has chosen to renovate existing lines rather than build new ones.

However, the £E5bn ($932m) budget for this is unrealistic at a time when the cost of delivering major infrastructure projects is rising worldwide.

In a sign of the times, a recent tender to overhaul the 1,300 level crossings along the Egyptian rail network is to be retendered after the bids came in substantially over budget.

“The infrastructure in Egypt is in a very poor state,” says one source close to the bidding process. “There is old equipment in use on the commuter lines and safety issues everywhere.

There are 1,300 official crossings, but certainly many more than that. Egypt has a densely populated countryside down the Nile. This means you have farm traffic crossing all over the place. The cost of upgrading this is going to be huge.”

Egyptian Railways (ER) and the Transport Ministry are looking around for new sources of revenue. World Bank funding of £E500m is being sought for work on the country’s signalling systems, and ER is planning to offer packages of railway stations for privatisation.

A contractor buying them will be able to build commercial facilities on the surrounding land in exchange for redeveloping the stations themselves, an approach used with limited success on the Tehran Metro.

There has also been talk of new, privately financed lines, including a high-speed link between Cairo and Alexandria, and one from Cairo to the Red Sea, but investors have so far shown little appetite for the proposals.

Plans for a new £E3.5bn railway between Obour City and 10th of Ramadan City appear to have stalled while ER reviews the financing of the project.

“The issue is how to make it attractive to investors,” says the source. “Can they rely on traffic volumes? If they rely on the Egyptian public, they cannot raise fares high enough.”

A further problem the government faces is how to develop and retain staff of sufficient quality throughout the network.

“Egypt Rail employs about 80,000 staff, and drivers are only earning about $100 a month,” says the source.

“The ministry needs to raise salaries, but is faced with the same problem as in other areas: how to slim the workforce at a time when unemployment is already high, to increase the wages of those critical staff.”

Algeria, Libya and Egypt will all face substantial challenges in the years ahead as they endeavour to revamp rail networks that have fallen into varying degrees of disuse and disrepair. But each has taken the first step along the way.

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