The Minister of Transportation,
Rotimi Amaechi, and his Power, Works and Housing counterpart, Babatunde
Fashola, have revealed why the federal government should take the proposed
$5.5bn foreign loan.
According to them, Nigeria will
benefit immensely if it takes the loan request to build new rail lines and
finance capital projects.
Speaking before the Senate
Committee on Local and Foreign Debts yesterday, Amaechi said the fund will be
used in completing the Itape-Warri rail line and to begin the Kano to Kaduna
and Port-Harcourt to Calabar rail lines.
The Senate committee had invited
the minister and some members of the executive to explain how Nigeria can pay
back the proposed loans from proceeds from the projects they would be expended
on.
Amaechi, while explaining the
economic viability of the proposed rail projects, said Nigeria may not
experience development until it grows its rail system.
“I will like to quote someone in
a conference I attended two days ago”, he stated.
He said there are three items a
country needs to develop its economy; power, iron which is the steel industry,
and the third one is the railway.
He said if any of these doesn’t
exist, there can’t be development. I’m sure that’s why we are having problems
in the growth of the Nigeria economy.
“After the completion of these
rail lines and when we have new locomotives, it’s going to contribute
tremendously to the growth of the economy. Imagine the impact on agriculture
alone. Imagine the deflation, drop in price that will happen if agricultural
products are conveyed seamlessly to the market.
“We can get return on the funding
in long term through freight because the money is in freight and not the
passengers. We have over 30 million tonnes of goods that is tied down between
Lagos and Kano alone. If you check our seaports, goods are tied down because of
Apapa road.
“What we plan between now and
December is to ensure that we truck it with the narrow guage to Ebute Meta for
those who want to distribute around Lagos and they can also take it from there
by road while we continue by rail to Kano and other parts of Nigeria,” he said
On his part, Fashola in a
statement yesterday by the Director of Press in his ministry, Olusegun
Ogunkayode, emphasised the need to source for loans to finance the development
of critical infrastructure as a fulfillment of the campaign promises of the
federal government.
Meanwhile, the Senate committee
chaired by Shehu Sani, will submit a report to guide the Senate in considering
the loan request.
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