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FG Commences Commercial Activities on Itakpe-Ajaokuta-Warri Rail Line

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  • FG Commences Commercial Activities on Itakpe-Ajaokuta-Warri Rail Line

The federal government yesterday directed the Nigerian Railway Corporation (NRC), to begin full scale commercial activities on the Itakpe-Ajaokuta-Warri rail line, thus ending the three-month free train ride it offered passengers on the axis.

The Minister of Transportation, Mr. Chibuike Rotimi Amaechi, gave the order while inspecting the level of work done so far from Itakpe, Kogi State, through, Agenebode, in Edo State, down to the East-west corridor at Owa-Iyibu, Agbor and Warri, Delta State.

The minister, while also responding to questions, shortly after the inspection, informed that, the sum of $3 billion would be needed to link the rail project from Itakpe to the nation’s capital, Abuja.

According to him, “that is a different project entirely. It would cost about $3 billion from Itakpe to Abuja with a seaport at Warri.”

Amaechi directed the NRC to fix a price for the Itakpe-Warri railway and stop the free train rides.

He said: “The commercial activities should resume fully today; I have already directed the MD to start collecting money.

“The plan to link Itakpe- to Lokoja has to go to the cabinet; once it is approved, it is a different contract all together but before then, the Itakpe-Warri will continue to function.

Speaking further, he said: “What we are doing now is to take people from the South -south to the North but, unfortunately, Itakpe is in the middle of nowhere and there is need to get them to Lokoja, so that people can pick train from Lokoja to Warri.

“The MD is also making arrangements where we create parking space for cars and buses in Itakpe, so that when they drop passengers they can pick passengers from Itakpe to Abuja.”

He said: “All trains in the world are affordable because government subsidises the cost for passengers. The problem is not the cost but the problem is whether we can break even.”

Asked why there is low patronage, he said: “If you connect it to Abuja, the number of passengers would increase. The track was initially built for iron ore but we asked them to include passenger services because we intend to use it as a central line.

“The idea is to connect Nigeria without too many tracks. So, if we construct Lagos to Calabar, Port Harcourt to Maiduguri, Lagos to Kano, they need a central line that runs through them so u connect the entire country. So, this is the central line which begins from Abuja to Warri.”

Continuing, Amaechi said: “So, if you look at it, Lagos-Calabar will run through it, the central line will run past Lagos-Kano as it go through central line then we will connect Maiduguri through Lagos-Kano

“So with that you have av connected the whole country moving them from one city to the other for now until we have enough money to do whatever we want to do.”

The minister, however, added that, by the time the entire 12 stations on the axis were completed, there would be track, offices and the companies mining iron-ore would be able to move their goods, while passengers would be able to use the train.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Economy

COVID-19 Vaccine: Crude Oil Extends Gain to $48 Per Barrel on Wednesday

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Oil prices rose further on Wednesday as hope for an effective COVID-19 vaccine and the news that the United States of America’s President-elect, Joe Biden has begun transition to the White House bolstered crude oil demand.

Brent crude oil, a Nigerian type of oil, gained 1.63 percent or 78 cents to $48.64 per barrel at 11:50 am Nigerian time on Wednesday.

The United States West Texas Intermediate (WTI) crude oil rose by 1.36 percent or 61 cents to $45.52 per barrel.

OPEC Basket surged the most in terms of gain, adding 3.16 percent or $1.37 to $44.75 per barrel.

This was after AstraZeneca, Moderna and Pfizer-BioNTech announced the positive results of their trials.

Moderna and Pfizer had claimed over 90 percent effective rate in trials while AstraZeneca said its COVID-19 vaccine was 70 percent effective in trials but could hit 90 percent going forward.

The possibility of having a vaccine next year increases the odds that we’re going to see demand return in the new year,” said Phil Flynn, senior analyst at Price Futures Group in Chicago.

Also, the decision of President-elect Joe Biden to bring Janet Yellen, the former Chair of Federal Reserve, back as a Treasury Secretary of the United States is fueling demand and strong confidence across global financial markets.

President-elect Biden’s cabinet choices, particularly Janet Yellen’s Treasury Secretary position, are adding to upside momentum across a broad space of asset classes,” said Jim Ritterbusch of Ritterbusch and Associates.

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Economy

Seyi Makinde Proposes N266.6 Billion Budget for Oyo State in 2021

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The Executive Governor of Oyo State, Seyi Makinde, has presented the Oyo State Budget Proposal for the 2021 Fiscal Year to the Oyo State House of Assembly on Monday.

The proposed budget titled “Budget of Continued Consolidation” was said to be prepared with input from stakeholders in all seven geopolitical zones of Oyo state.

Governor Makinde disclosed this via his official Twitter handle @seyiamakinde.

According to the governor, the proposed recurrent expenditure stood at N136,262,990,009.41 while the proposed capital expenditure was N130,381,283,295.63. Bringing the total proposed budget to N266,6444,273,305.04.

The administration aimed to implement at least 70 percent of the proposed budget if approved.

He said “The total budgeted sum is ₦266,644,273,305.04. The Recurrent Expenditure is ₦136,262,990,009.41 while the Capital Expenditure is ₦130,381,283,295.63. We are again, aiming for at least 70% implementation of the budget.”

He added that “It was my honour to present the Oyo State Budget Proposal for the 2021 Fiscal Year to the Oyo State House of Assembly, today. This Budget of Continued Consolidation was prepared with input from stakeholders in all seven geopolitical zones of our state.”

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Economy

World Bank Expects Nigeria’s Per Capita Income to Dip to 40 Years Low in 2020

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The World Bank has raised concern about Nigeria’s rising debt service cost, saying it could incapacitate the nation from necessary infrastructure development and growth.

The multilateral financial institution said the nation’s per capita income could plunge to 40 years low in 2020.

According to Mr. Shubham Chaudhuri, Country Director for World Bank in Nigeria, the decline in global oil prices had impacted government finances, remittances from the diaspora and the balance of payments.

Chaudhuri, who spoke during the 26th Nigerian Economic Summit organised by the Nigerian Economic Summit Group and the Federal Government, said while the nation’s debt is between 20 to 30 percent, rising debt service remains the bane of its numerous financial issues and growth.

Nigeria’s problem is that the debt service takes a big part of the government revenue,” he said.

He said, “Crisis like this is often what it takes to bring a nation together to have that consensus within the political, business, government, military, civil society to say, ‘We have to do something that departs from business as usual.’

“And for Nigeria, this is a critical juncture. With the contraction in GDP that could happen this year, Nigeria’s per capita income could be around what it was in 1980 – four decades ago.”

Nigeria’s per capita income stood at $847.40 in 1980, according to data from the World Bank. It rose to $3,222.69 in 2014 before falling to $2,229.9 in 2019.

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