Kenya has begun negotiations with the United Arab Emirates (UAE) to secure funding for a regional railway project after China withdrew its support. The railway, which was part of China’s Belt and Road Initiative, connects the Kenyan port of Mombasa to landlocked neighbors but halted in 2019, leaving a 468-kilometer gap to Uganda’s border.

President William Ruto, following meetings with UAE officials in Abu Dhabi on Tuesday, confirmed that Kenya is exploring a partnership with the UAE to extend the Standard Gauge Railway (SGR) to Uganda and South Sudan. The two nations are expected to carry out a feasibility study for the railway extension, which Ruto highlighted as a vital project for regional integration and trade enhancement.

This development comes as Kenya is also finalizing a 1.5 billion-dollar commercial loan from the UAE for budget support, a move that strengthens the economic ties between the two nations. The two countries recently signed a comprehensive economic partnership agreement aimed at boosting trade by removing trade barriers, simplifying customs processes, and promoting investments.

Trade between Kenya and the UAE has surged over the last decade, with the UAE now being Kenya’s sixth-largest export market and its second-largest source of imports. In 2023, the trade value reached 445 billion shillings ($3.44 billion), with Kenya exporting agricultural products to the UAE and importing petroleum, machinery, and chemicals.

Additionally, the UAE’s Abu Dhabi National Oil Company and Emirates National Oil Company are part of a group of Gulf firms selected by Ruto’s government in 2023 to supply Kenya with oil on extended credit terms, shifting away from the previous open tender system.