Rail-ways in all major capital city of the Federation...
Minister of Transport, Rotimi Amaechi spoke with journalists in Lagos where he inspected ongoing railway projects.
This administration has an ambitious rail project but the question remains, why are you piling up loans instead of developing the rails through the Public Private Partnership, PPP or getting private companies to come and finance it instead of loans and public funds?
"I challenge anybody to show me anywhere in the world where railway lines are built by private funding business? For them, it does not make any economic sense for a private business to put money in railways. There is nowhere in the world where railway has been constructed with private funds."
***But what has the Transport Ministry, under your leadership, been doing to revamp the railway?
There are three key factors that aid development. The first is steel and you know Nigeria has no steel; the next is power and the third is railway. Railway is expensive to construct, private funds are not used to construct railways. We are fixing all the narrow gauge, which is about 3,500 kilometres. GE(General Electric) and the consortium is expected to bring $2.7 billion to fix the old rail line from Lagos to Kano, to Funtua.
So, the objective of this government is to ensure that at least all the state capitals have rail services. So, if you check Lagos-Ibadan, it will be completed in December 2018. By January 2018, hopefully if we get the loan, we will start Ibadan-Kano. We have constructed Abuja-Kaduna and we are constructing Lagos-Ibadan, we will not wait for that to finish but by next year, we will start Ibadan-Kano. Once we complete that, we have 1,500 km standard gauge but we had earlier awarded the contract to China Civil Engineering Construction Corporation, CCECC, hoping that the Chinese would fund Lagos-Calabar.
The Chinese came back two months ago and said they didn’t have money to fund the Lagos-Calabar rail project. So, we are going round looking for money, we have proposals.
Some people have indicated interest in funding part of the Calabar-Port Harcourt rail project and we are talking with them. We are talking with other groups who want to fund Port Harcourt-Maiduguri. The central line we intend to complete next year starts from Itapke-Warri. The president has directed us to start from Abuja-Itakpe but by next year, we are sure to launch the train services from Itapke-Warri while we are looking for money to construct Abuja-Itakpe to join the one we have completed from Itakpe to Warri.
****But these are plans…?
They are not just plans, they have gone beyond planning. Most of those we are discussing with, we are not just talking about taking loans, what we are discussing with them is for them to bring ten per cent equity, while we (FG) bring ten per cent equity. The company we would form as special-purpose entity, SPE, will then borrow the remaining 80 per cent.
What we are trying to do is to also get private individuals to join us to borrow the money and run it; and because their company has participated in the loan, they will all run it to pay back.
