Chinese state firm awarded contract for the construction of Nigeria’s Lagos-Kano rail project

China Civil Engineering Construction Corporation (CCECC) has been awarded a $6.68 billion construction contract of a major segment of the Lagos-Kano railway in Africa’s biggest economy.

“The signing of the … segment contract agreement today (Tuesday) concludes all outstanding segments of the Lagos-Kano rail line,” Xinhua said, quoting Nigeria’s transport ministry.

Lagos-Kano railway project started in 2006 and implementation of the project was apportioned in sections. CCECC, which is a subsidiary of Chinese state rail builder China Railway Construction Corporation, has been a part of the project from inception. And Part of the funding for constructing the railway line which is projected to take two or three years, will come from China. China Exim bank in April approved a $1.231 billion loan for the network’s reconstruction programme.

Prior to the award of the Lagos-Kano rail project, Nigeria awarded the Chinese state firm on a segment between the northern states of Kano and Kaduna in 2016, with a contract sum of $1.685 billion.

The railway that is to link Nigeria’s commercial hub Lagos, in the southwest, and Kano in the north, is part of the government’s $41 billion railway expansion plan that will help reduce dependency on its oil sector and diversify its economy. Africa’s most populous country had been seeking other means to diversify it’s economy after undergoing it’s worst economic slide in over two decades, as a result of a drop in the price and output of oil which is a major source of the country’s revenue.

However, government has centered the economic recovery plan on diversification through boosting the agriculture sector and production. In order to actualize this plan, the government has recognized the key importance of advancing the country’s transport system and power infrastructure.

“Revamping of the rail transportation system is crucial for successful diversification of the Nation’s economy,” said Nigeria’s transport minister Rotimi Chibuike Amaechi in a report. “It will also increase earning’s from non oil investments.”