China Civil Engineering Construction Corp signs US$6.68 billion Nigerian rail project

China Civil Engineering is building a rail link between Lagos and Kano in Nigeria

China Civil Engineering Construction Corp (CCECC) has signed a US$6.68 billion agreement with the Nigerian Federal Government to build a rail line linking its biggest city Lagos with Kano, northern Nigeria's commercial hub. The Lagos-Kano rail modernization project started in 2006 and was divided into several project phases. The length of the total line will be approximately 1,000 kilometres. The first 187 kilometre segment runs between the capital city Abuja and Kaduna, in the centre of the country. It entered into service in 2016.

The same year CCECC signed a contract for a second segment of the line, running north from Kaduna to Kano. Total cost is estimated at US$1.69 billion, including a US$1.5 billion loan from China Exim Bank. This segment should be completed by the end of 2018. "The signing of the Ibadan-Kaduna segment contract agreement concludes all outstanding segments of the Lagos-Kano rail line," said a statement by Nigeria's Federal Ministry of Transportation on 15 May 2018. Transport Minister Rotimi Amaechi, while signing the contract agreement with CCECC, said the completion time of the contract should be between two and three years. Nigeria has around 3,500 kilometres of line in place, most of which was built prior to independence in 1960.

Elsewhere in Africa China is heavily involved in the construction of Uganda's road programme, aimed at achieving its transformation agenda and strategic national development plan. The ground-breaking of the 69 kilometre Kigumba-Bulima road took place in February 2018, upgrading the road from gravel to bituminous standard, with the objective of improving transport service levels in western Uganda. The project is financed by a loan from the African Development Fund (ADF), UK Department for International Development (DFID) and financing from the Government of Uganda (GoU). The project has been contracted to M/s China Railway No.5 Engineering Group. It is expected to be complete by August 2020.

There is also likely to be Chinese interest in the Kampala-Jinja Expressway which is about to proceed as a public-private partnership (PPP) project, on a design, build, finance, operate, maintain and transfer basis. On 18 May 2018 the Uganda National Roads Authority (UNRA) issued the Request for Qualification.

According to the document, the expressway between Kampala and Jinja and the bypass south of Kampala, which make up the Kampala Jinja Expressways, will be an important import-export corridor in East Africa. The project will comprise a 77 kilometre mainline between Kampala and Jinja and an 18km bypass south of Kampalaand. It will become the backbone of the national road network and the primary entry point of goods into Uganda and transiting to Rwanda, Democratic Republic of Congo and South Sudan.

The delivery of the project as a PPP is part of the 2008-2023 National Transport Master Plan, in which the government prioritizes development of the national road network through PPP for asset delivery and a long-term whole life consideration of operations and maintenance. The project is part of the regional integration initiative to improve trade in east Africa.

The project bidding comprises two separate lots. Lot 1 is the 35 kilometre section of expressway from Kampala to Namagunga (Kampala-Namagunga Section) and an 18 kilometre bypass south of Kampala (Kampala Southern Bypass). Lot 2 comprises the 42 kilometre section of expressway from Namagunga to Jina (Namagunga-Jinja Section). The African Development Bank, Agence Francaise de Developpement and the European Union are considering providing funding support and credit enhancement towards the development of Lot 1.