We’ll commence laying of tracks on Lagos-Ibadan rail line by next month, says Amaechi
Minister of Transportation, Mr. Chibuike Amaechi, spoke to some journalists in Lagos on the update and efforts at revamping the railway. GODWIN IJEDIOGOR was there and reports.
This administration has an ambitious rail project. But why are you piling up loans instead of developing the rails through the Public Private Partnership (PPP) or getting private companies to come in 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 by private funds.
But what has the Ministry of Transport, 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 the narrow gauge, which is about 3,500 kilometres. GE (General Electric) and the consortium are 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 for 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.
The day we made 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.
The objective of this government is to ensure that at least all the state capitals have rail services. The Lagos-Ibadan will be completed in December next year. By January next year, 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 kilometres standard gauge but we had earlier given the contract to China Civil Engineering Construction Corporation (CCECC), hoping that the Chinese would fund Lagos-Calabar. But they came back two months ago and said they didn’t have money to fund it. We have proposals and we are going round looking for money.
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 to Itakpe, but by next year, we are sure to launch the train services from Itapke to 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, we are discussing with them to bring 10 per cent equity, while we (Federal Government) bring 10 per cent equity. The company we would form as a special-purpose entity (SPE) will then borrow the remaining 80 per cent.
We are trying 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.
We will allow them to run and see whether they can recover the money, while we make our contributions to pay part of the money.
Can you give some kind of timeline?
You can’t do that until you have all the funds. I will be able to say that by June next year. But I can tell you that Lagos-Ibadan will be completed next month. Don’t forget that the contract for it is three years, but because I know Nigerians wanted to see results, I told them no, because the Chinese government told us that they construct 1000 kilometres per year, so why should 126 kilometres take them three years?
They said it was a double carriageway, but I told them to break themselves into gangs and that five gangs could complete it in a year. That is what they are doing and by next month, they will start laying the tracks.
What are your plans for Apapa, especially with the traffic gridlock on that axis?
We are talking with GE to initiate an interim phase agreement, which is a plan to put in place a structure that can get the rail to start running, no matter how slow.
Nigerians would be interested to know when the trucks would leave Apapa?
GE is bringing in six narrow gauge locomotives in the next one month and will also bring in 100 wagons. With the six locomotives and 100 wagons, we will then begin to transfer the goods from the seaport.
All Lagos-bound freights will likely be transported to Papalanto in Ogun State. I won’t accept Ebute Metta, because trucks have taken over the roads, so I said instead of that, they should move to Papalanto and pick up their goods. But the non-Lagos goods should go straight to their locations, no matter how long it takes, than to drop all of them in Papalanto.
The best thing is to leave all Lagos goods at Papalanto and the rest goods will be transported direct to their destinations. That, I have directed.
We are in a hurry, because some of you are not patient enough, you want the results delivered, despite the time constraint we have.
You probably may not be able to deliver with the rate you are going…?
Let me tell you why one should be ambitious. Lagos-Kano was on board in 2006 and Lagos-Calabar was on board before we came in. President Muhammadu Buhari came and said we should not award any contract, but construct those two rail lines, and we are looking for money. People politicise the issue of railway, but it has to do with economics; it has nothing to do with politics.
By the way, it is enough if we get the narrow gauge to 200kph (kilometres per hour), but Nigerians said they want speed train. I tell people that they should not politicise development; we are Nigerians.
One thing I can say to the public is I am not under pressure from the president. The pressure I am under is the pressure of making sure that there is result, but not for me to do it in certain areas. The decision to itemise the railway projects is left to me.
What is driving the rails are economic goals, which is why you see I am pursuing the central line. There are two types of economic zones that you can look at here. One is that the solid minerals are found more in the northeast. That is why we develop the Port Harcourt-Maiduguri rail, because once Nigeria leaves oil and goes into mining, you will see the benefit of the rail. If you don’t have rail, forget about mining.
The reason the president is pursuing the rail is because of the diversification of the economy. If we are going to diversify our economy, it means that we are going to depend greatly on the northeast, not just for food, but also for the mining.
Land-locked neighbouring countries do not import through Nigeria again, they import through Lome, Cotonou and Ghana. There are several factors, one of which is that there are no rail lines that get up to their countries. So, if we do the Lagos-Kano and connect from Kano-Niger Republic, they have no reason to say they cannot come to our area.
The other reason they gave is the numerous checkpoints. But if they put their goods on the railways, they will have overcome the issue of checkpoints, which will boost the economy of Nigeria too.
So, rail development is focused on economic development.
You are trying to do so many things at the same time, yet you said you are not under pressure…?
(Cuts in) The president is not pressurising me on the choice of where to go, but I am under pressure to carry out economic development. Since the president has said he wants to diversify the economy, which is his focus and the focus of this government, we are less interested in oil and more interested in economic diversification. If that is what he is saying, then there will be no economic diversification until we deal with railway.
Are you not worried that you may probably not achieve or complete any of the projects by doing so many things at the same time?
Why don’t you wait till then? I have been Speaker of Rivers State House of Assembly for eight years, my record is there. I have been a governor for eight years, my record is there. I have been minister for two years, why don’t you wait?
It was less than six months after I became minister that we fixed Abuja-Kaduna rail line, which was abandoned before I came for lack of funding.
What are your biggest challenges?
Funding, and I have said that several times and that is why you see me trying to run everywhere to look for funds. It is not every country that gives money, even if it is at commercial rates. There are so many countries out there looking for money; it is not only us.
Nigeria is also looking for money to fund the budget?
Why can’t we, for the first time, praise the Buhari government? When we came, what was the per capita recurrent ratio? It was below 20 per cent per capita and it is currently 84 per cent. In our first year, we did 25 per cent.
The difference between us and the past is that we don’t borrow to the government, I hope you got that, we lend money to projects.
To be paid for by the government…?
Are you saying we should not borrow? We must show a bit of understanding of the issues. You cannot even run the economy without borrowing. There is no economy in the world you can run without borrowing. The United States is borrowing trillions of dollars.
We have not surpassed the ratio. Everyday, we look at the ratio and ensure that we do not surpass it. Are you asking us not to develop?
Some people believe we need to amend the Railway Act of 1965 to fast-track railway development in Nigeria?
The Railway Act is before the National Assembly, I think it has passed the second reading and hopefully, they will pass it. Let us give them some time to pass it.
How would you assess this government, especially in your ministry?
Whether Nigerians accept it or not, we did not promise to perform miracles. We knew there would be challenges. I was chairman of the Nigeria Governors’ Forum (NGF) at a time and I knew the huge stealing that was going on. I knew that Nigeria was bleeding.
When we took over, what we did not expect as we landed was that oil price would crash the way it crashed. We didn’t also know that there was a political plan to drown the economy if they lost.
When we looked at the economy when we came in, our economic experts said we needed to spend ourselves out of recession. We were told that we needed to pump money into the system. Which government has come to power and started paying contractors of the other party that was in government?
Other governments will ignore them and employ their own contractors. But the president directed that we needed to put money in the system for two reasons. One was to bring back the economy, the second is that to restore the economy, you have to make the people consume.
For the first time, we spent over $1 trillion on capital and we were paying contractors for contracts that were awarded by the previous governments. We could not award contracts of our own until this year.
So, when anybody wants to assess the government, you must look at what we are doing vis-a-vis the noise we are making. The problem we have is that we are not making enough noise; everybody is doing his or her work quietly.
Anyone who can’t speak about Buhari does not know the man. I acted as his director-general for 10 months, so I know the man and I can tell you that he is committed to the development of Nigeria. One good thing about him is that once he makes up his mind to be focused on the development of Nigeria, he wants to achieve that development that he wants.
What is important to him is a united country that provides for the poor and the rich. Have you seen our convoys?
Regarding railway development, I have decided to ensure that we keep to timelines, so the first week of every month, I visit Lagos. During the week, we had a meeting with the Chinese contractors, the Lagos, Oyo and Ogun state governments and NRC chairman to assess what we did the previous month and see whether we achieved them.
Our target is to commence laying of tracks by next month, but we are having challenges with gas pipelines and power assets on the alignment. We have written, no response; we have four bridges that are challenges to us; we have found solutions to three of them to allow the trains pass.
We are doing all that and hope that the people will be understanding and give us time to allow us finish. The time they gave us is four years. We don’t have money, so we have to borrow.
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