The Minister of Transportation, Rotimi Amaechi, has defended the federal government application of $5.5 billion loan to fund some capital projects, saying it will benefit the nation immensely.
Amaechi at the senate
While speaking before the Senate Committee on Local and Foreign Debts, the Minister of Transportation, Rotimi Amaechi, on Thursday, said that Nigeria will benefit immensely if it takes loan request to build new rail lines, adding that the fund will be used in completing the the Itape-Warri rail line and to begin the Kano to Kaduna and Port-Harcourt to Calabar rail lines.
According to Premium Times, 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.
Recall that President Muhammadu Buhari had on Tuesday October 10,
written the Senate to approve the federal government plan to apply for a $5.5 billion loan to fund some capital projects, including the Mambilla hydro-power project, construction of the second runway of the Nnamdi Azikwe International Airport, counterpart funding of rail projects and construction of Bonny road with a bridge across Opobo channel.
While explaining the economic viability of the proposed rail projects, Amaechi, said Nigeria may not experience development until it grows its rail system.
He said; “I will like to quote someone in a conference I attended two days ago. 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.