The Ethiopian government is planning on constructing the country’s first light rail in its capital city Addis Ababa. The project is expected to bring both short-term and long-term benefits: it can help with alleviating the city’s traffic congestion problem, and more importantly, lay the technological foundation for Ethiopia’s grand strategy for a national railway system. Once completed, this modern public transport system will boost the political legitimacy of the incumbent regime. However, building a light rail is especially expensive for Ethiopia, a country already facing a huge burden with debts. Moreover, investment is badly needed for other types of infrastructure, such as power generation and road construction in rural areas. Should the light rail project be prioritized? Should the Ethiopian government consider alternative solutions to its city traffic problem (such as a Bus Rapid Transit system, or simply improving roads and urban planning)? This case examines that decision making process.