Niger Deltans want to hear FG releases, not approves $2.3bn for Lagos-Calabar rail
…Score Amaechi low, accuse him of abandoning zone in 4 years
Recent announcement by the Minister of Transportation, Rotimi Amaechi, during his valedictory press conference in Abuja last week that the Federal Government has approved the sum of $2.3bn for the development of Lagos-Calabar coastal rail line has generated mixed reactions.
The new rail scheme which was earlier captured in the 2018 budget had been apparently abandoned as all federal interests on rail were diverted to Lagos-Ibadan and Abuja-Kaduna-Kano-Katsina to Niger Republic during the budget year.
Several Niger Deltans who barred their minds on the Minister’s announcement said they are tired of hearing of approvals which usually take more than two to three years to see release of funds if not finally forgotten.
They said there is nothing to cheer whenever approval is made in Nigeria but when funds are released as that marks the true reality of every project.
One of the aggrieved Niger Deltan from Rivers State decried that “The Minister decided to make the announcement because very soon, he will be leaving office as the Minister of transportation. We are going to ask him what did you achieve in fours for your people”?
According to the Nigerian who pleaded anonymity, “If you ask him what he achieved for his people of South-South as transport minister, he will quickly ask you if you are not aware of federal government approving $2.3bn for the coastal rail line from Lagos-to Calabar.”
However, giving details of how the fund will emerge, Amaechi revealed that of the sum, $1.8bn would come as a loan from China, while the Federal Government would provide $500m as counterpart fund.
He further explained that the rail line would transverse Lagos, Delta, Anambra, Benin, Rivers and Cross River states, with connections to the central rail line that goes to Abuja.
Amaechi noted that “The government has approved for us to seek a loan of $1.8bn to start work on the coastal rail. The coastal rail is from Lagos to Calabar. So we are taking the segment that starts from Port Harcourt to Warri to join the central line that goes to Abuja.
“And then another segment that starts from Benin to Onitsha. But as it is going to Onitsha, it will join the central line again at Agbor. The Port Harcourt-Warri line will join the central line at Warri. The Benin-Onitsha line will join the central line at Agbor. They are all part of the coastal rail line, which is about $11.1bn.”
The minister also created a condition of fear when he further explained that “The project fund is $2.3bn, but I said $1.8bn because Chinese banks, if they approve, will be providing that while we will look for $500m, which will be the counterpart funding.”
“There are other projects that are considered for construction. The one that we just got approval for from the cabinet is the central line, which begins from Abuja through Baruo, Itakpe and Lokoja; that has been approved. With a seaport to Warri approved.
“However, in that case, the Federal Government is not borrowing any money, the SPV (Special Purpose Vehicle) will borrow the money. The Federal Government will contribute 15 per cent of the equity, the contractor will contribute 10 per cent of the equity and we will form an SPV that will borrow 75 per cent of the equity.”
Continuing, the minister said “The Federal Government will give a sovereign guarantee to enable them to get a quick loan. In turn, the contractor will give us a performance guarantee. The performance guarantee means that since you have concessioned this project to me after the completion, I will run the seaport and the rail line in such a way that I will pay back in 20, 30 or 40 years time, depending on the agreement reached.”
“So, the repayment of the loan will be done by the SPV, the Federal Government will guarantee the loan and in turn the contractor will give us a performance guarantee. If it works out, that’s a wonderful type of PPP and it was ingenious of the ministry to have done that.”
In the spirit of many South-South indigenes, Amaechi failed them as far as transportation infrastructural development under the administration he served is concerned.
