Tuesday, November 13, 2007

Fund paucity threatens Lagos-Kano rail project

Fund paucity threatens Lagos-Kano rail project
By Moses Ebosele, Senior Transport Reporter

ONE year after it was launched with fanfare by former President Olusegun Obasanjo, the Lagos-Kano rail modernisation project may have screeched to a halt.

The first phase of the project, awarded to the China Civil Engineering Construction Corporation (CCECC), involves a 1,315-kilometre double track standard gauge rail lines. It is divided into five segments and costs $8.3 billion, excluding other administrative and consultancy costs.

Kicking off the project at Kajola, Ifo Local Council of Ogun State in November 2006, Obasanjo announced its completion period as "the next 48 months."

The Guardian learnt that the project is being reviewed by the Umaru Musa Yar'Adua administration, particularly in view of its costs.

The Minister of Transportation, Diezani Alison-Madueke, however, buttressed this at the weekend when she said that the Federal Government had raised an inter-ministerial committee, among others, to determine how to fund the project.

The minister, who took a 10-kilometre train ride from Ebute-Metta to Ikeja Rail Station, as part of activities lined up for her maiden visit, explained that the Federal Government is determined to embark on an aggressive marketing aimed at restoring the lost glory of the parastatal.

She reiterated the commitment of some private organisations to partner with the government in its effort to revive the sector.

Though Mrs. Alison-Madueke declined to entertain questions after reading from a prepared speech, The Guardian learnt that Yar'Adua, recently, expressed his concern over the $8.3 billion project. The source added that the Chinese firm had prepared the survey while the design and construction have not been completed.

"The President is still consulting with experts on how to handle this project", the source said, adding that there is need for extreme caution.

Recently, Finance Minister, Dr. Shamsudeen Usman, said that the government may review the terms of the Chinese loan for Railway projects.

The minister, who spoke in Washington DC, United States (U.S.), explained some of the terms of the loan were of concern to the Yar'Adua administration

The government in June 2006 secured a $2.5 billion Chinese loan for the reconstruction of the country's railway line that would pass through seven major towns of Lagos, Ibadan, Ilorin, Abuja, Kaduna, Zaria and Kano.

The Obasanjo administration had in 2002 unveiled a 25-year plan to restructure the moribund Nigerian Railway Corporation (NRC).

The scheme embraces what it termed "a restoration, renewal, modernisation and expansion of over 7,800 km railway lines traversing through the entire country."

Under the project, railway modernisation and expansion is estimated to cost over $40 billion.

Alison-Madueke, during the visit, inspected facilities at the locomotive workshop, running shed, mechanical/electrical training school and foundry department, among others.

In his presentation during the minister's visit, NRC Managing Director, Jetson Nwankwo, said the Corporation was assisting the CCECC in the movement of its equipment to site.

"It is pertinent to mention here, however, that the government is aware of the aforementioned constraints and challenges that have occasioned the attendant and phenomenal downturn in the fortunes of the corporation.

"This is why the Federal Government is armed with greater quest and preparedness to bring Nigeria Railway to the front burner where it will, most efficiently, perform its social and economic roles for a better society," he said.

Alison-Madueke believes that drastic reform in the NRC will make it more energised, invigorated, enterprising, innovative, result-oriented and a creative organisation to drive the nation's economy.

At the boardroom of the NRC headquarters in Lagos, the minister stated that "we really and truly need to resuscitate our railways' system and we need to do it in the shortest possible time to allow the railway mode of transportation exert the desired impact in the on-going economic transformation of Nigeria."

She added that "it is not enough for us to have just the roads as our major arteries of transportation. That will not do any longer. It is clear to everybody that the dilapidated and degraded state of our roads is as a result of the heavy volume of traffic and the increasing tonnage that these roads take, which they were never designed for in the first place. It is almost impossible to find an engineering solution for our roads. And, believe me, I am desperately looking for one right now that will continue to take these unexpected and unplanned-for volume and weight of traffic."

The minister recalled the contributions of the Nigerian railways to national development in its glorious heydays, and regretted that within the last 20 years, the NRC had declined drastically, partly because of increased competition from road transport and the integral problems of management inertia, poor funding, aged and ageing assets which have not been renewed.

She admitted that the 25-year rail development plan started in 2006 with the award of the first phase of standard gauge rail line spanning over 1,315 kilometres from Lagos to Kano, and awarded to Messrs CCECC at a cost of $8.3 billion and the planned second phase extending from Port Harcourt to Maiduguri at a cost of over $9 billion were facing serious challenges.

On the pension crisis in NRC, Alison-Madueke pledged: "Very importantly, I will explore all practical and creative avenues to ensure that we find solution to the lingering NRC pension related matters. It goes against grain to have people who have worked diligently for their country for so many years particularly in this area where we have some of the finest craftsmen and women in this country out there, to find them suffering because they have not been paid their pensions. We will go out of our way, and I mean it to liquidate all NRC pension arrears within the shortest possible time."

This article was taken from the online Nigerian Guardian newspaper.

1 comment:

zen said...

If this project could actually be seen through to completion that would be amazing. The roads in Nigeria are in bad condition and this might be partly due to them being rival in consumption where the use of it by one person decreases its value, and partly due to allocated funds being used for other things. But fixing up and creating new railroads would solve a lot of transportation problems and probably have a positive effect on the crime level. I support this endeavor and hope the right people will be given the right funding and support to see it through to completion despite the problems posed in this article.