FROM ISAAC ANUMIHE, ABUJA
The Federal Government has directed the Bureau of Public Enterprises (BPE) to collaborate with Nigeria Infrastructure Advisory Facility (NIAF) with a view to developing a roadmap for the concession of the Nigeria Railways Corporation (NRC), rail tracks.
NIAF has committed to fund the consultancy for the development of the project.
The decision was reached following a presentation by the Director General of the BPE, Mr. Benjamin Dikki at the meeting of the council in Abuja.
In a statement, Head, Public Communication of BPE, Mr Alex Okoh, said that the Public Enterprises (Privatization and Commercialization) Act, 1999 scheduled the Nigeria Railway Corporation (NRC) for privatization and the National Council on Privatization (NCP) in 2002 approved that the enterprise be concessioned to private operators to provide freight and passenger railway services using the vertical integration model.
The decision to reform the railways was borne out of government’s desire to avoid the collapse and eventual shut down of the railways, generally regarded as neck-deep in losses but socially and economically imperative to the nation. In view of the funding challenges facing the future of rail in Nigeria, the railway reform, restructuring and privatization programme were specifically aimed at achieving the objectives of providing the framework for private sector-led growth through expanded domestic and foreign investment; improving NRC’s ability to provide adequate, safe, reliable and efficient rail services; and reducing NRC dependence on the FGN budget by introducing private sector investment in the sector.
Recall that a new railway bill which is one of the eight reform bills recently approved by the NCP and Federal Executive Council (FEC) is currently before the National Assembly for passage into law.
The new bill seeks to among others, repeal the Nigerian Railway Corporation Act, 1955; provide the appropriate market design and legal framework for the implementation of Government’s reform programme; separate the roles of policy making, regulation and operation; provide a platform for the introduction of private sector concessionaires and promote competition in the provision of railway services nationwide.
In 2005, the Bureau, through the World Bank funding, engaged the services of CPCS Transcom as Transaction Advisers to advise in the concession of the rails. The firm had completed about 80 per cent of the assignment including the concession of the Central Railways (Itakpe-Ajaokuta-Warri line which terminates at Ovu) and the due diligence on the entire rail network before its contract was suspended because of the proposed modernization of the network which was to replace the existing network with wider gauge. But following the lack of funding, the modernization project was shelved by the Federal Government which directed that the existing network should be rehabilitated and concessioned to private operators.
The rehabilitation of the railway system includes track spot renewal of Lagos to Kano and Maiduguri to Port Harcourt lines, supply of 25 new locomotives to boost existing locomotive power base of the corporation, upgrading of carriage and wagon workshops, re-equipping the workshops, supply of service support, strategic rebranding of the corporation, rehabilitation of stations and marshalling yards.
Source : SunOnline