For Effective Management, Efficient Service Delivery, FG unbundles Nigerian Railway Corporation

• Plays important role in maritime insecurity in the Gulf of Guinea
• Promoting Development of Inland Dry Ports

In a bid to reposition the Nigerian Railway Corporation (NRC), for effective management and efficient service delivery, Federal Ministry of Transport has taken steps towards unbundling and commercializing the Corporation.

This was disclosed by Minister of State for Transportation, Senator Gbemisola Saraki in her Keynote address delivered at the Nigeria International Partnership Forum which has the theme Building Excellence For The Future of Nigeria’s Transportation System: Reforms, Results and The road ahead. The even was held at the Shangri-Lar Hotel, Paris, France, on 10th November 2021.

Saraki said the Corporation would be unbundled into four subsidiaries namely:

1. Regulatory; 2. Infrastructure – network creation, upgrade & maintenance;3. Operations – network operations; and, 4. Services – the rolling stock operations, rolling stock creation & procurement and rolling stock maintenance.

The Keynote Address Reads:

KEYNOTE ADDRESS DELIVERED BY THE HONOURABLE MINISTER OF STATE FOR TRANSPORTATION, SEN. GBEMISOLA R. SARAKI AT THE NIGERIA INTERNATIONAL PARTNERSHIP FORUM WITH THE THEME “BUILDING EXCELLENCE FOR THE FUTURE OF NIGERIA’S TRANSPORTATION SYSTEM: REFORMS, RESULTS AND THE ROAD AHEAD” HOLDING AT THE SHANGRI-LAR HOTEL, PARIS, FRANCE, ON 10TH NOVEMBER 2021

PROTOCOLS

I am honoured and delighted to participate at this International Partnership Forum to discuss “Building Excellence for the Future of Nigeria’s Transportation System: Reforms, Results and the Road Ahead” in the beautiful city of Paris, the capital of a nation once described as “a land of true freedom, democracy, equality and fraternity”.

2. I am optimistic that this address will shed light on where Nigeria is with respect to its transport systems, the efforts we are making and the opportunities that abound within this sector.

3. Distinguished Ladies and Gentlemen almost six years ago, the world gathered here in Paris in November 2015, to collectively chart a course towards tackling the challenge of climate change, with the purpose of leaving our children, a planet that is cleaner and safer. Six years on, we have all borne witness to just how intimately connected we are and the need for a collective approach to the task of nation building and development.

4. The consensus reached in the Paris Agreement, is that the world needs a new model of development and growth, that will be beneficial to all. As we collectively reflect on those commitments, the global community must be prepared to have those difficult conversations that are critical to ensuring the goals and objectives of that Agreement are met. President Muhammadu Buhari reaffirmed in Glasgow last week, that the pathway to adaptation and resilience to the realities of climate change, will require innovative action from all in an interconnected world.

5. One of the key lessons of the unprecedented impact of the Covid 19 pandemic, is that unlike individuals, global issues cannot be confined within borders and conversely, that global solutions necessitate cooperation beyond our traditional understanding of boundaries of sovereign states. It has turned out that we are truly brothers’ keepers.

6. So why should the world care about what happens in Africa? The world must care about Africa, because how African nations tackle development through its policies and projects are not only beneficial to its citizens, but also reverberate – positively or negatively- on the global stage.

7. Africa still lags behind the rest of the world in coverage of key infrastructure, including road, rail transportation and water infrastructure. Closing the Continent’s huge infrastructural deficit is vital for the continent’s economic prosperity and sustainable development as improved infrastructure would facilitate increased intra-regional trade, reduce the cost of doing business, enhance competitiveness, create employment, and reduce the tide of illegal migration.

8. According to African Development Bank, an estimated $170 billion Dollars per year by 2025 will be required to finance Africa’s infrastructural needs with an estimated gap of about $100 billion yearly.

9. In response to this, our Administration’s vision for economic recovery, diversification, and sustainability, led to the Economic Recovery and Growth Plan (ERGP) initiative, which focused on non-oil sectors such as Agriculture, Transportation, Industrialization, Science, Technology, and Innovation (STI).

10. The Government appreciates that human capital and gender inclusion are key to growth. The policies that are adopted by government must be mindful of the disproportionate challenges that women face due to infrastructural deficiencies, so that women become a critical component to economic recovery and growth. Engaging women and women-based enterprises on the supply and value chains of the infrastructural sector, must become an important part of the global ambition for post-pandemic recovery. After all, African women traditionally shoulder many family care responsibilities and, the frontline roles they played during the pandemic, exposed their resilience, vulnerability and the pivotal role women play in our societies.

11. It is the Administration’s conviction that this is the pathway to ensure food security, job creation, a competitive business environment and Foreign Direct Investment (FDI).

12. The Government has also developed Medium- and Long-Term National Development Plans to restore economic growth while leveraging on the ingenuity and resilience of the Nigerian people.  

13. Distinguished Guests, Ladies and Gentlemen, the Federal Government has embarked on various initiatives to actualize the potential in the Transportation sector over the past years.  

RAIL SUB SECTOR

14. There has been renewed commitments to railway transport as a key component for socio-economic transformation. Of note, is the 25-year Strategic Plan targeted at the rehabilitation of all the existing narrow gauge rail lines, construction of new standard gauge lines, connection to all Sea Ports, State Capitals, Mining and Agricultural clusters and technological hubs by rail, as well as their operation and maintenance in the country.

15. This has led to some success stories such as the commissioning of the Abuja -Kaduna; Warri – Itakpe and the Lagos – Ibadan rail lines, as well as the Wagon Assembly plant in Ogun State. These are now all operational for both commercial and passenger activities.

16. Our proposed rail projects will generate sustained freight growth of an average 7.9% between 2021 and 2025. Of these projects, Port Harcourt – Maiduguri; Kano – Maradi in Niger Republic and Kaduna -Kano are already at the commencement stage.

17. In the bid to reposition the Corporation for effective management and efficient service delivery, the Administration has taken the initial steps towards unbundling and commercializing the Nigerian Railway Corporation into four subsidiaries namely:

(1) Regulatory –

(2) Infrastructure – network creation, upgrade & maintenance

(3) Operations – network operations

(4) Services – the rolling stock operations, rolling stock creation & procurement and rolling stock maintenance.

18. The Unbundling will optimise operations and costs; advance private sector participation; drive competition in the industry; enhance service delivery for customers and improve infrastructure and other asset maintenance.

MARITIME SUB SECTOR

19. Nigeria has the second longest length of waterways in Africa, covering about 853km extensive coastline, 10,000km of Inland Waterways and an Exclusive Economic Zone of 200 Nautical Miles and in the process of an additional 150 Nautical Miles of Continental Shelf.

20. We are a dominant player in the West and Central African sub-region and the Gulf of Guinea (GoG), controlling over 70% of shipping traffic in the sub-region.

❖ 21. As a maritime nation, Nigeria plays important role through its relevant Agencies to check the menace of maritime insecurity and other safety challenges in the Nigerian Maritime Domain and in the Gulf of Guinea (GoG) region. As a response to these challenges, the Ministry introduced an integrated Maritime Safety, Security Waterways and Environmental Protection Strtegies. One such example is the Deep Blue Project that involves provision of Satellite and Communication Equipment, patrolling Assets and Capacity Building for the enforcement/intervention teams.

22. The International Maritime Bureau has severally commended this initiative and in one of its reports it noted that the number of kidnapping and robbery in the Gulf of Guinea in the second quarter of 2021 is the lowest since 2019. While 33 incidents of piracy were reported in the last quarter of 2020 6 cases were reported in the second quarter of 2021.

23. Another success story is the coming into being of the Suppression of Piracy and other Maritime offences (SPOMO) Act, 2019 which aimed at securing timely prosecution of maritime offenders. Since the promulgation of the Act, 12 cases have been successfully prosecuted and 10 convictions were secured.  

Permit to state here that this is the very first of such in Africa and other African nations have taken this Act to study and replicate.

24. Some specific achievements at the Ports are the introduction of the electronic call-up system (E-call-up) to substantially address the problem of traffic gridlock using technology in Lagos Ports and the conversion of a Container Terminal to a Vehicle Transit Area (VTA) for ease of cargo evacuation.

25. The Nigerian Shippers’ Council is promoting the development of Inland Dry Ports, Container Freight Stations and Vehicle Transit Areas in partnership with Private Investors to facilitate trade by the seamless and safe movement of freight to and from the seaport and within the country.  

ROAD SUB SECTOR

26. The Federal Road network is 35,000 km representing about 17% of the national road network of 200,000km. However, they are strategic routes that carry 70% of road traffic in Nigeria and connect major cities in the six (6) geopolitical zones of the country, making it a major enabler in the Nigerian economy.

27. Nigeria continues to make investments in upgrading the road stock despite the paucity of financial resources.  In addition to regular sources of funds, the government is also deploying innovative funding approaches for strategic road projects.  

28. The Presidential Infrastructure Development Fund (PIDF) is investing over a billion dollars in three flagship projects: the Lagos-Ibadan Expressway, the Second Niger Bridge, Abuja-Kaduna-Zaria-Kano Expressway.

29. Executive Order 7 seeks to mobilize private investment into the development of key roads and bridges like Bodo-Bonny in Rivers and the Apapa-Oshodi-Oworoshonki-Ojota in Lagos.  

30. The Highway Development and Management Initiative (HDMI) is also a public-private partnership program to mobilize, in its first Phase, over One Trillion Naira in private investment into the development and maintenance of 12 key roads of about 2,000 kilometers in length.

31. Ladies and Gentlemen, the Federal Ministry of Transportation recently embarked on the Road Transport Transformation Programme to revamp the Sub-Sector thus enabling it create millions of jobs, contribute immensely to GDP growth, and enhance environmental sustainability.  The RTTP upon completion will amongst other things, strengthen road transport policy and regulatory framework, enhance safety and security, transition to environmentally sustainable transportation and Gender participation in the road transport subsector.

AIR SUB SECTOR:

32. The Air Transport Sub-sector has seen activity return after the COVID-19 global aviation disaster. Bilateral Air Agreements are now being restored; more domestic airlines are coming up with newer and modern aircraft in their fleets. A plan to establish Nigeria’s National Carrier through a Public-Private Partnership (PPP) is being vigorously pursued.   There is a plan to Concession the four (4) major International Airports namely, Muritala Mohammed International Airport, Lagos; Nnamdi Azikwe International Airport, Abuja; Mallam Aminu Kano International Airport, Kano; and Port Harcourt International Airport, Port Harcourt.

33. Other Areas for Aviation Investment include: Maintenance, Repair and Overhaul (MRO) Centre; Development of Cargo/Agro-Allied Terminal; Establishment of an Aviation Leasing Company, Establishment of Airport Cities (Aerotropolis) in our International Airports.

34. Whilst we have recorded many successes, there are still some challenges within the transportation sector. These challenges include minimal intermodal connection, insufficient funding, stringent legal and regulatory framework, minimal Private Sector participation, Multiple Taxation and Regulatory Agencies, Duplication of functions that cause Inter-Agency Conflicts.

35. The Ministry of Transportation is an active part of the ease of doing business intervention of the current administration under the Presidential Enabling Business Environment Council (PEBEC). The Council’s reform activities are aimed at making Nigeria a progressively easier place to start and grow a business. These efforts resulted in Nigeria moving up an unprecedented 39 places in the World Bank’s flagship Doing Business Report over the last three cycles of the report and being twice recognized as a global top 10 reformer due to reforms at our seaports, airports and within the country that are facilitating trading within Nigeria and across borders.

36. The ratification of the African Continental Free Trade Area Agreement (AfCFTA) has created the opportunity for Nigeria to leverage its geographical position, large domestic market, and industrial capacity to become the Transportation Hub for Africa.

37. Let me recap: The Nigerian Transportation Sector is working to align with Global Best Practices and promote policy, legal and institutional reforms. These include incorporating the use of Intelligent Transport System, ensuring full automation of its Ports and other Mobility processes. Similarly, the Transportation Ministry advocates for Public-Private Partnership (PPP) in developing infrastructure and operations under a Sustainable Environmental condition in all modes of Transportation with a culture of timely maintenance of Transport Infrastructure.

38. For Investment and partnership to happen, prospective partners must show mutual respect, desire for justice and equity in the pursuit for oneness. Nothing has demonstrated this so vividly as the current effort to return African artefacts taken away one way or another out of the continent to Europe back to us in Africa. An exercise that has drawn wide commendation and applause across the continent and which President Macron has graciously taken up as a responsibility and a program of cooperation, as he eloquently put that, “All young people need to take possession of their country’s history in order to better build their future.”

39. When the Nigerian statistics are given – nation of over 200 M people, with different and varied culture, religion and beliefs, a nation with 526 different languages, people are amazed at how difficult it must be to govern such a country. But then again, even Gen Charles de Gaulle had once pondered over such a question ….not about Nigeria, but his own country. France, for he once asked, “How can you govern a country which has 246 varieties of cheese?”

40. In a world where prosperity of all nations is inextricably linked, I assure you all that we at the Federal Ministry of Transportation and other related institutions are ready to work with you to attain the shared ambition of growth and sustainability.

Thank you for listening, and God bless.