The China Development Bank (CDB) announced on Tuesday that it has approved a loan of $254.76 million (€245 million) for the Kano-Kaduna railway project in Nigeria.

According to information on the bank’s website, the funding is expected to provide crucial financial support for the ongoing development of the railway, ensuring the project proceeds without delays.

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.

Once completed, the railway will offer residents a safe, efficient, and convenient transportation alternative, significantly enhancing regional connectivity.

Beyond improved mobility, the railway project is poised to stimulate economic activity along its route. It is expected to promote the growth of related industries and generate numerous job opportunities for Nigerians during both the construction and operational phases.

The project has been highlighted as 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.

According to the bank, construction is progressing smoothly. 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.

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.”

What you should know

• Last year, the Minister of Transportation, Saidu Alkali, disclosed that China has 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 also assured that the Ibadan-Abuja-Kaduna-Kano railway project would be completed to the satisfaction of Nigeria and West Africa at large.
• The Federal Government last week said the ongoing construction of the Kaduna to Kano rail line will be completed before the end of this year.
• The government also said it was hoping to construct a speed rail from Abuja to Lagos before the end of the year.
• It said two organisations have indicated interest in constructing the speed rail through a Public Private Partnership (PPP) agreement.
• The Permanent Secretary in the Federal Ministry of Transportation, Mr Adeleye Adeoye, said the construction of the speed rail would start as soon as the Infrastructure Concession Regulatory Commission (ICRC) completes its due process and gives the ministry the green light.
• The Federal Government budgeted N44.4 billion for the completion of the Abuja-Kaduna Railway project, Lagos-Ibadan railway, and other railway projects across the country.