The Federal Government recently suspended the proposed $8.3 billion Lagos to Kano railway modernisation project awarded to the China Civil Engineering Construction Corporation (CCECC) by the administration of former President Olusegun Obasanjo. This decision – one of many ‘reversals’ of Yar’Adua government – is seen as regrettable by the punter, however it might be a blessing in disguise as it offers an opportunity for a rethink. I’m however not under any illusion about why the project was cancelled.
Mr. Tanimu Yakubu, chief economic adviser to President Umaru Yar'Adua, told the committee probing the $8.3 billion proposed Lagos-Kano standard gauge rail line that the Chinese firm was in contravention of Section 54 of the Companies and Allied Matters Act (Cama), which prohibits foreign companies from doing business in the country without being legally registered in Nigeria. He said the President Yar'Adua-led administration considers the contract to be illegal because it was not presented to the National Assembly for ratification. While the official status of the project is yet to be disclosed, the status of the contract however needs to be clarified because the body language of Yakubu indicates that the contract is as good as dead.
My concern with the project has nothing to do with budget appropriation or registration of CCECC with the Corporate Affairs Commission (CAC). I consider the basis, need and justification for such a huge financial investment in upgrading a rail line between Lagos-Kano to be fundamentally flawed for various reasons.
Firstly, why do we have to procure rail engineering expertise from China? There is a fundamental difference between ‘human resources’ and ‘human capacity’. With its population size, there is no doubt in my mind that the Chinese have the resources to undertake any project (as seen in recently concluded Olympics). However, I’m not convinced that they have the capacity (in terms of skills) to design a ‘world class’ rail system. When you mention rail projects, we are not just talking about construction workers, but technical expertise in terms of planning, design and engineering. It is worth noting that the planning, design and engineering expertise for the recently constructed Beijing-Tianjing Intercity Rail was sourced from mainland Europe. Only contracts for civil construction and engineering supervision were limited to local Chinese firms. That says a lot about how much faith the Chinese have in their own expertise. I don’t Nigerians are interested in ‘Made in China’ railways, or train parts from ‘Chinatown’.
Secondly, why spend such a huge amount of money on upgrading an existing rail line – converting narrow gauge track to standard gauge?
The Lagos-Kano rail line stretches to 11,315 kilometres and would run on double track. The speed limit will be pegged at 150 kilometres per hour. After the upgrade, it would take less than four hours to travel from Lagos to Kano. The project will also include construction of 39 stations and two workshops and would be run through independent power supply system. The Chinese also offered a five-year maintenance period. The entire project would cost $8.3 billion. Even though the Federal Government only paid the Chinese company a paltry sum of $250 million being three per cent of the entire total cost, instead of $1.356 billion, being the 10 per cent mobilisation fee promised, the company immediately moved to site, armed with the due process certificate for the payment made.
While this might look good on paper, the question needs to be asked about how many people will be travelling daily between Lagos-Kano to justify this investment. With a travel time of four hours, are constructing a commuter or tourist rail network? For me, the rail line will only b useful for long distance travel. This in itself raises more questions than answers. How many people travel daily on this route? How many times a day is it expected to operate? Has there been any cost-benefit analysis undertaken for the project? I’m sure that if a cost-benefit analysis is undertaken, the numbers will definitely not stack up. Does the time savings to be achieved by converting narrow gauge to standard gauge worth $8.3 billion dollars in real terms?
While I’m not totally against upgrading Nigerian railway infrastructure, I’m of the opinion that $8 billion earmarked for this project can be better spent. For starters, let me point out that there is nothing wrong with ‘narrow gauge’ rail tracks. While standard gauge is modern and used in most parts of the world, there are still many developed nations with narrow gauge rail tracks. While it might be better to build new rail tracks as standard gauge, the conversion cost is too expensive for most countries, hence the reason why it is still widely in use.
The Federal Ministry of Transport should be setting a strategic policy for rail development in the country, starting with a cleansing of the Nigerian Railway Corporation. Railway transport in Nigeria is inefficient and has hardly developed at all over the past 100 years compared to railways in the developed world. This is due both to maladministration by successive governments and to the lack of a functional transport policy ensuring a constant pattern of railway development.
In developed countries, transport policy is dynamic and changes responsively accordingly to technological trends in the transport sector. Efforts should be focussed on developing rail network in sub-regional areas. There is likely to be more patronage demand along Lagos-Ogun-Oyo, PH-Warri-Enugu and Minna-Kaduna-Abuja corridors. The Lagos Rail Mass Transit project should be supported by the FG with funds and be extended to Ogun State as part of the Lagos Mega City Project. The transport infrastructure in our major cities should be fixed as a matter of priority.
Even if the FG decides to go ahead with the project as it is, who will be responsible for operation and maintenance? Is it the ‘paralysed’ Nigerian Railway Corporation? Only God knows what goes on in the NRC nowadays. The organisation has proven beyond every reasonable doubt that it is incompetent to move the nation rail system to the next level.
Until the government comes out in the open to tell us its official position on the project, we can only keep asking ourselves, where to from here…, ?
Seyi Osiyemi is a Transportation Planner and lives in Brisbane, Australia