FG Seeks To Intensify Diversification From Oil With $41bn Of Railway

FG Seeks To Intensify Diversification From Oil With $41bn Of Railway

Nigeria has started a $41 billion railway expansion to reduce dependence on oil and diversify its struggling economy by improving transport links to allow the movement of goods around the country and to ports, Bloomberg reports.

“The plan we have now will go to every nook and corner,” Transport Minister Rotimi Amaechi, 52, said in Abuja. Africa’s biggest oil producer is going through its worst economic slump in 25 years following a plunge in the price and output of crude, which accounts for more than 90 percent of foreign income and two-thirds of government revenue.

Key projects include building a second railway line connecting the nation’s two biggest cities, the commercial capital, Lagos, and Kano in the north. The 1,100-kilometer (680-mile) line will carry freight and passengers. The government also wants to construct a coastal railway that connects Lagos to the eastern city of Calabar.

The two new railways are expected to cost $20 billion, with most of the funding coming from the Export–Import Bank of China, which has so far released $5.9 billion. China’s Civil Engineering and Construction Co. is building the project and both railways should be ready by the end of 2019.

GE is also leading a group that’s rehabilitating Nigeria’s 3,505 kilometers of century-old, narrow-gauge railways linking the coastal cities of Port Harcourt and Lagos with the north. The group, including SinoHydro of China, South Africa’s Transnet SOC Ltd. and the Netherlands’ APM Terminals BV will fund, revamp and operate the railways for a period to be decided in negotiations with the government, the minister said.

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