January 8, 2025
China has approved a loan of $254.76 million (€245 million) for the Kano-Kaduna railway project, the China Development Bank, CDB, announced on Tuesday after the loan approval.
The Kano-Kaduna railway is a standard-gauge line spanning 203 kilometers, designed to connect Kano, a major commercial hub in northern Nigeria, to the nation’s capital, Abuja.
According to information on the bank’s website, the funding is expected to provide crucial financial support for the ongoing development of the railway and ensure the project proceeds seamlessly.
Once completed, the railway will offer residents a safe, efficient, and convenient regional connectivity.
Aside improved mobility, the railway project is also expected to stimulate economic activity along its route, promote the growth of related industries and generate numerous job opportunities for Nigerians during both the construction and operational stages.
The project is a key initiative under the Third Belt and Road Forum for International Cooperation. It is being executed by the China Civil Engineering Construction Corporation (CCECC), with financing provided by the CDB.
The CDB emphasized its commitment to continued collaboration with the Nigerian government to ensure the timely disbursement of funds and effective management of subsequent phases of the project.
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The bank noted that “going forward, it will closely coordinate with Nigerian partners to ensure the smooth disbursement of subsequent loans and effective post-loan management”.
The Minister of Transportation, Saidu Alkali, had disclosed Last year, that China had committed to funding the Ibadan-Abuja and Kaduna-Kano sections of the Lagos-Kano railway under the Belt and Road Initiative.
The Minister noted that most of the ongoing rail projects were awarded under an EPC+F (Engineering, Procurement, Construction, and Financing) model. This model requires 15% counterpart funding from the federal government, with the remaining 85% expected to be sourced through loans.
Alkali, however, said securing funds from banks has been challenging, as financial institutions perceive significant risk associated with railway projects and are hesitant to proceed with the loan arrangements. Consequently, China was approached to help fund some of these projects.
President Bola Tinubu, has assured that the Ibadan-Abuja-Kaduna-Kano railway project would be completed to the satisfaction of Nigeria and West Africa.
