The government of Nigeria and China Railway Construction Corp International (CRCCI) have signed a US $3.9bn contract for the
completion of the Abuja-Warri railway corridor.
The project will be a public-private partnership,
with Nigeria providing an equity stake of 15%, CRCCI an equity stake of 10%,
and the remaining 75% borrowed from China’s
Export-Import (Exim) Bank. CRCCI will also recover its investment by managing the railway and
port for 30 years. During the project, the railway heading south from Abuja
will pass through the city of Baro where a branch line will be built to Lokoja,
the Kogi State capital.
According to The Minister of Transportation,
Chibuike Rotimi Amaechi, outstanding funds arising from the rail contract will
be borrowed with the Federal Government’s guarantee, which will also be
backstopped by performance bond from the company.
“There is a concession agreement that requires
CRCCI to manage both the railway and the seaport and recover the 75% and pay
the money. The Chinese company is also expected to operate with the aim of
meeting the repayment term of borrowing within a construction period of thirty
years,” he added.
The project will create jobs opportunities for
Nigerians as well as catalyse economic activities by encouraging easier and
more efficient transportation across the country. A more crucial problem the
railway projects have helped solve is the insecurity along interstate roads in
the country.
As seen in developed economies, adequate transport infrastructure is a catalyst for economic growth and development. Thus, the planned railway corridor, along with several other ongoing railway projects, is a major development based on the potential contributions towards achieving economic development in Nigeria.https://constructionreviewonline.com/2019/11/nigeria-signs-us-3-9bn-contract-for-completion-of-abuja-warri-railway-corridor/
