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Why eastern railway project is on hold—- Amaechi

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By Olugbenga Salami

Minister of Transportation, Mr. Rotimi Amaechi, on Tuesday declared that the non approval of $30billion foreign loan by the National Assembly as requested by the federal government is stalling the Eastern rail project.

This is even as he affirmed that for the federal government to construct standard gauge of rail lines from Port Harcourt to Maiduguri, a whopping sum of $12.8billion (N9trillion), which is the entire size of a whole year budget for the country, would be needed.

Amaechi spoke when he appeared before the Senate’s joint Committees on Land Transport, Local and Foreign Debts investigating the alleged exclusion of the Eastern rail lines in the rail revitalization projects across the country.

The Senate had last week, mandated the joint committees to summon the minister to clarify the alleged exclusion of Eastern rail line in the nationwide railway projects across the country, captured in the foreign loan obtained by President Muhammadu Buhari for that purpose.

The upper legislative chamber took the decision following its consideration and adoption of a motion moved by the Deputy Senate President, Senator Ike Ekweremadu, drawing the attention of the chamber to the perceived injustice to the Eastern flank of the rail project.

But at his appearance, Amaechi told the lawmakers that there was no plan to exclude the region from the rail project and assured the committee that the area is already captured in the 2018 borrowing plans of the Federal Government, part of which was the $30bn foreign loan from China EXIM Bank.

He added that though on their own part as executive , the required design for the project has been done but approval for both the design and costing are being delayed by bureaucratic bottleneck caused by the Public Procurement Act, PPA.

“The Public Procurement Act is very tedious and take a long time to conclude the process which must be followed because President Buhari had always insisted that the rule of law be followed to the letter.

“The President insists on rule of law and the law passed by the National Assembly in terms of public procurement is very tedious and not easy to conclude; it takes a very long time.

“Similarly the law passed by the National Assembly on the Bureau for Public procurement is very tedious”, he said.

The minister also pointed out that railway project was very capital intensive, and that the Federal Government did not have sufficient fund to implement the railway projects across the country at the same time.

He explained that following the inadequacy of funds confronting the government, the All Progressives Congress, APC-led administration had decided to adopt a systematic approach in the project execution, saying that it was as the loan was approved, then government would apply the fund and do what it could afford.

“We have met with both GE and the consortium handling the project for nearly two years now and we are still on it even as the first firm as handed over to TRANSNET, Transport Network.

“Let me make it clear, the country does not have the resources to do railway in every village. It is not possible. $2.7 billion is N1 trillion.

“So, for the railway you want to do from Port Harcourt to Maiduguri is about $12 .8billion which is about N9trillion equivalent to one year budget of Nigeria.

“Therefore, everything is done systematically, we can’t do all the projects at the same time. What we are doing is as we get the loan approved, we execute the project. Currently, we are following due process for the one of South East.

“Currently we have placed an advertisement on the Eastern Rail lines. Sometime in 2017, we placed an advertisement for rail from Port Harcourt to Maiduguri and that is what the law expects us to do. We can’t skip the law on construction of standard gauge.

“Again, even the narrow gauge construction does not only concern the the South East. The same narrow gauge transversed Port Harcourt to Maiduguri. I don’t know what other thing the Senate expects from me on this project except to say that it is work in progress.

“We are not magicians and the current law we have insists on the number of times we shall advertise a project, we completed the project we pass it to Bureau for Public Procurement, which in turn will be referred to us before we go to the cabinet for presentation and I think we are set to go to the cabinet for approval”.

On the insinuation that General Electric, GE has pulled out of the project, Amaechi explained that the company handed over the contract to another sister company because it was no longer in the transport business.

“It (GE) handed over the job to another sister company in the consortium which is Trans-net. We are at the verge of signing the contract agreement and it is when we finished signing the consortium agreement that we will begin to look for money to execute the project. The total cost of the project is $2.7billion and it is a Private Partnership agreement”, he noted.

Chairman of the committee, Senator Olugbenga Ashafa, APC-Lagos East, expressed satisfaction with the explanation given by Amaechi, urging the minister to ensure that no section of the country was excluded from the rail project.

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