- Ogun to invest in rail, targets $100bn GDP
The federal government has stated that it intends to raise several billions of naira from companies and state governments from all rights of way, advertising and estate developers along all railway routes in the country.
The Minister of Transportation, Rotimi Amaechi, made this known monday while speaking at the First International Rail Conference holding in Lagos, tagged, “Nigeria Railway Industry Moving from 19th to 21st Century: Challenges and Opportunities.”
Represented by the Director of Rail Services, Mohamed Babakobi, the minister said the government would channel the funds realised into the construction and maintenance of existing rail assets in the country.
He called on stakeholders, experts and top players in the rail sector to partner with the federal government and come up with ideas on how this could be achieved.
Amaechi, who stressed that the federal government was committed to revamping the rail sector, stated that the government would ensure that Nigerians benefit from the railway contracts being awarded by enforcing the local content policy.
He said the federal government had instructed Chinese investors to employ Nigerians where the country has competence, further disclosing that compliance with the policy was currently at 25 per cent in the sector.
Also speaking at the event, the Governor of Ogun State, Senator Ibikunle Amosun, said the state government would invest massively in railways to grow the gross domestic product (GDP) of the state from $20 billion to $100 billion.
He said one of the strategic ways to achieve this was through the provision of an inter-city rail network.
According to him, “This would make Ogun State highly competitive, thus attracting more industries, commerce and real estate development. The Ogun light rail project will be an alternative to road transportation to ensure the creation of multi-modal transport hubs and nodes, which would act as a catalyst for economic and social growth.
“With this development, the intercity railway would be used, as in other parts of the world, to drive economic growth. Lagos State has a GDP of $131 billion and currently has a housing deficit of over 3 million houses.
“We have the land to meet this housing deficit and create a $5 billion economy through inter-city rail development. It is our plan that we will leverage on our close proximity to Lagos State, and our strategic position as the Gateway to the over 200 million population in the West African sub-region.
“Ogun State intends to grow her economy by exploring strategic linkages with both the economies of Lagos and the West African sub-region, providing widespread economic benefits to the good people of the Gateway State.”
Managing Director at Planet Project Limited, organisers of the event, Abiodun Otunola, disclosed that transportation accounts for 30 per cent of the cost of goods and services in Nigeria.
He commended the federal government’s effort at revamping the rail sector, stressing that a lot is happening in the sector at the moment.
He said: “The federal government has committed over $10 billion in the rail sector,” adding that the economy could not grow if the rail sector is not fixed.
“More than 50 per cent of our rail system is narrow gauge which makes the rails very slow. Some state governments are doing very well in this regard. Apart from Lagos State, Ogun State is doing a good job in the sector.
“Our vision and goal is to start a process that will bring back the rail system in Nigeria,” he stated.