The Federal Government allocated $62.66 million to service debts related to the railway sector in the first quarter of 2023, according to a report from the Debt Management Office(DMO) on Nigeria’s external debt service payments.
The total expenditure for Q1 2023 slightly exceeded the $61.73 million spent in Q1 2022. This increase in railway debt servicing expenses coincided with the government’s struggle to generate revenue from the railway sector.
The National Bureau of Statistics revealed that the number of rail transportation passengers declined by 53.65 percent, dropping from 953,099 in Q1 2022 to 441,725 in Q1 2023. Likewise, the quantity of goods transported increased from 39,379 tonnes in the same quarter of 2022 to 59,966 tonnes in Q1 2023.
In terms of revenue, passenger earnings for the period amounted to N768.44 million, representing a 63.02 percent decrease compared to N2.08 billion in the corresponding quarter of the previous year.
An Economics professor at Olabisi Onabanjo University, Sheriffdeen Tella
blamed the situation on various factors, including insecurity, as contributors to the decline in train service patronage in Nigeria.
He also listed cost of transportation fare relative to other modes and the need for adequate maintenance of facilities to ensure efficient operations.