Minister of Transport, Rotimi Amaechi has described the current running of the Railways business in the country as under perform as it being manage only by the Federal Government. He stated this while speaking with spoke journalists in Lagos where he inspected the ongoing railway projects. Excerpts:
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?
He said: 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. They will also fix from Port Harcourt to Maiduguri, and they will recover their funds in 20 to 30 years depending on what we agree on. But when it comes to construction, which private company will bring $1.5 billion for the construction of the Lagos-Ibadan railway line for instance? So, usually, the government bears the brunt so that the economy can grow.
Imagine that we finish re-constructing the narrow gauge. The day we make the rails to function, the price of tomatoes would reduce drastically because we would then be able to convey cheaply and more conveniently, bulk quantities of tomatoes from the north to Lagos and other states in the South. 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.