Business
Abuja-Kaduna train breakdown: A taste of the Chinese pudding
The Abuja-Kaduna train breakdown that happened last week presents a good illustration of the age-old adage that says: the taste of the pudding is in the eating. From all indications, the taste of the pudding which China is cooking for Nigeria is beginning to emerge already.
For over ten hours, some Nigerians were stranded in the middle of no-where, abandoned in the bush as a result of a failed locomotive. The train ride with all the luxury it purports to offer left a very sour taste in the mouths of the passengers, as they were buffeted by hunger and thirst for several hours, not to talk of failed appointments and the deep fear of being kidnapped due to high level of insecurity around that corridor.
There can be no gainsaying the fact that the breakdown of the locomotive is a foretaste of what is to come. The incident seems to tell Nigerians what the situation will be in the next five to ten years. Unfortunately, a taste of it couldn’t wait. As the transportation minister, Rotimi Amaechi, has said the embarrassing incident is so early in the day, and is quite unexpected. We quite agree with him. If this can happen at this time, less than one year of operation, one can imagine what the case will be in the next ten years.
True, the breakdown of the locomotives was not expected at this time by Amaechi and the government of the day. This is because the Nigerian government officials either trust the Chinese so much or have chosen to underestimate or ignore the famed craftiness and propensity of the Chinese to cut corners. On the other hand, it could be because Nigeria has become a beggar before China, and as the saying goes, a beggar has no choice. In that light, she must take whatever China throws her way.
Indeed, one cannot talk about the train breakdown incident without talking about how the contract that gave birth to it was procured, same with other ongoing rail projects across the country.
These rail projects are being executed with loans from China. The loans are tied to projects and disbursed by the China EXIM Bank, with the interest said to be subsidized by the country’s Ministry of Commerce. The commerce ministry assigns Chinese contractors to execute projects.
With such an arrangement, the project becomes entirely Chinese affair. The money barely gets into the hands of Nigeria since the loans are offered in the form of projects. Thus, most of the funds given out actually go back to China by way of supplies, salaries, allowances and housing of top and middle-level manpower, construction contracts and the whole equipment which are brought in from China.
With all the equipment, including the locomotives coming from China as part of the loan deal, Nigeria is not in a position to know or determine the competitive cost and quality of the equipment. Nigerian negotiators will not know if the shiny locomotive is new or refurbished. All they do is to celebrate the arrival of the locomotives from China, and when everything is put together, they assemble to commission it with fun fare. How long the locomotive or equipment will last is another issue as there is no performance bond signed.
With what has begun to emerge so early in the day, one is afraid how Nigeria will be able to repay the loans, given envisaged breakdowns which might impact on the operation of the railways. The breakdowns, if they become frequent and severe, may render some rail lines unviable, and therefore, disposed to take-over by the Chinese. The story of China loan/infrastructure projects in the developing countries especially, Africa presents a frightening scenario.
Across the African continent, in most of the transactions with China, corruption or kickbacks by government officials have been alleged. The loans are largely concessionary with lots of suspected undercover dealings and perks in favour of African government officials. These come in form of huge kickbacks, which largely do not go through the banking system.
The presence of the kickbacks indicates that the actual cost of investments in the projects will actually fall far short of negotiated loan amounts. This is a cause of worry concerning future default on these Chinese loans.
Another source of worry is the opaqueness of the Chinese projects and loans across all jurisdictions. In every country that China has shown its ‘magnanimity’, all the infrastructure of roads, ports, highways, railways and airports financed with these loans all connect to China in what has been aptly described as the “new silk road.” This means, perhaps, that these infrastructures are forever tied to China.
One curious thing is while China can give Nigeria refurbished locomotives or inferior equipment without batting an eyelid, it is willing to ‘donate’ to her a transport university said to worth $50 million. The amount even a kindergarten pupil knew that might have conveniently built into the inflated cost of the railway projects.
This is similar to its donation of a mighty Secretariat to the African Union Commission in Addis Ababa, Ethiopia – a gesture which has provided it a good launching pad to gain easy access to virtually all African countries, offering them irresistible loans that are tied to projects. The secretariat was also rumoured to be a mine of classified information for Chinese as they allegedly installed high tech spying gadgets all over the building during its construction.
While the Minister of Transportation, Rotimi Amaechi, and the managing director of NRC Fidet Okhiria, have apologized to Nigerians, with the NRC MD promising that the breakdown will not occur again, Nigerians remain skeptical of what the future holds for all the Chinese largesse for Nigeria.
* Business & Maritime West Africa Saturday Editorial
Auto
Yingqi Auto Machinery opens factory to revive vehicle engines in Lagos
Yingqi Auto Machinery opens factory to revive vehicle engines in Lagos
‘Don’t throw away your old vehicle engines’
An auto company specializing in car engine refurbishment, Yingqi Auto Machinery Co Ltd, has been established in Lagos.
The firm says its aim is to help motorists maximise the service life of their vehicles.
In addition, the firm provides new energy technology support for companies in the automotive industry, including natural gas engines, electric vehicles and other technologies.
Located in the Ojodu Berger of Lagos State, the company opened its doors to corporate as well as individual customers at a an impressive event attended by stakeholders in the industry including the Rector of Yaba College of Technology, Dr. Ibraheem Abdul.
Managing Director, Yingqi Auto Machinery, Mr. Vincent Ke, in his address at the event, said, “The birth of Yingqi Auto Machinery stems from a group of entrepreneurs with an unending passion and pursuit for automotive technology.
“Our team brings together elite talents from the automotive field, with rich industry experience, deep professional knowledge, and keen insights.”
He added, “Yingqi Auto Machinery, with its unique perspective and innovative thinking, is focused on the automotive sector, dedicated to solving industry challenges through advanced technology and improving people’s quality of life.”
The MD also spoke on the need for collaboration, saying, “As an international partner, I fully understand the importance of cross-border cooperation and exchange.
“In today’s globalized world, no country or enterprise can exist and develop in isolation”.
Mr. Vincent Ke, who is a Chinese national, also explained that the company is ready to play by the rules and assist in developmental projects in Nigeria.
He said, “We are also keenly aware that as a new enterprise, we bear greater social responsibility.
“We will actively respond to Nigeria’s national policies, promote green and low-carbon development, and contribute to Nigeria’s progress.
“We will also actively participate in public welfare and give back to society, doing our part in Nigeria’s development.”
Some of the machines already installed at the factory include a surface grinder, which is used to grind the surface of the engine block, stopping overheating and other related problems, and the boring machine for boring holes in the engine block, thereby bringing the engine back to standard.
Others are the benchtop grinder and honing machine to smoothen inside the engine block, as well as crankshaft grinder, lathe machine, hydraulic machine, among others.
Also speaking, the Rector of Yaba College of Technology, Dr. Abdul, said, “Yaba College of Technology welcomes Nigerian enterprises to participate in the college’s cooperation.
“We firmly believe that through the joint efforts and in-depth cooperation of both the university and enterprises, we will surely achieve even more fruitful results in talent cultivation, scientific research innovation, and social services.”
Owner and promoter of Nike Art Gallery, Nike Davies-Okundaye, praised the decision of the company to set up a factory in Nigeria, as she noted that it would contribute to job creation and transfer of technology.
She noted that Nigeria and China had come a long way in their developmental collaborations, and urged Yingqi Auto Machinery to keep the cooperation going.
Business
FG not responsible for petrol price hike, says minister
FG not responsible for petrol price hike, says minister
The Federal Government says it is not responsible for the latest increase in the pump price of petrol.
The Nigerian National Petroleum Company Limited (NNPCL) on Wednesday increased the pump price of petrol from N897 per litre to N1, 030 in Abuja; from N855 to N998 in Lagos; N1,070 in North-East; N1,025 in other South-West states; N1,045 in the South-East and N1,075 in the South-South.
The Nigeria Labour Congress in its reaction asked President Bola Tinubu to order an immediate reversal of the sudden increase.
But Minister of Information and National Orientation, Mohammed Idris, said the government should not be held responsible for the latest hike in petrol price.
The minister said the NNPCL made the decision in response to prevailing circumstances in the energy industry.
He stressed that the oil company did not act on any instruction from the Federal Government, adding the government could no longer fix prices of petroleum products, in line with the provisions of the Petroleum Industry Act (PIA).
He said with the subsidy regime ending since May 2023, the NNPCL had only been paying differential to keep the price within the range it had been, but the company said it could no longer absorb the losses.
“The differential you’re seeing is a result of different factors. One of them is the crisis in the Middle East. There’s volatility in the market. Therefore, the prices of petroleum products are going up, consistent with what is happening with other operators in the industry globally.
“Secondly, NNPC cannot continue to absorb these losses for Nigeria because as a limited liability company, it would be operating at a loss,” he said.
The minister urged Nigerians to continue to show understanding with the NNPCL and the government, assuring that in the long run the prices would ultimately come down.
He said the government would continue to invest the savings from removal of subsidy to improve other critical sectors such as healthcare, education, infrastructure, and security.
FG not responsible for petrol price hike, says minister
Auto
Convert your vehicle to CNG with pay later portal launched
Convert your vehicle to CNG with pay later portal launched
The Federal Government has opened a website for people interested in converting their petrol-powered vehicles to run on compressed natural gas (CNG) and pay later for the service later.
The National Orientation Agency (NOA) announced this new initiative on its X handle in a statement.
“Switching to Compressed Natural Gas (CNG) is now more accessible than ever,” it stated.
“With flexible payment plans tailored to fit your budget, transitioning from petrol to CNG has never been smoother or more affordable.
“These payment options allow you to convert your vehicle now and pay later with affordable monthly instalments at competitive rates.”
The agency said with an easy online application and quick approval process, beneficiaries would be supported every step of the way, to ensure a hassle-free experience.
“Visit: gocng.ng to get started,” NOA said.
The agency listed the benefits of CNG as cost savings, environmental impact, enhanced engine life, safety and reliability, as well as proven technology with a track record of safety and dependable performance.
The FG on October 7, launched a portal that would allow youths to access CNG-powered tricycles.
Project Director and Chief Executive Officer (CEO) of the Presidential CNG initiative (P-CNGi), Michael Oluwagbemi, said the initiative would enhance the economic well-being of Nigerians by reducing dependence on petrol.
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