Russia Pledges $12bn For Ghana’s Rail Sector

[dropcap]R[/dropcap]ussia is seeking to invest an estimated $12 billion in Ghana’s railway sector through various Public Private Partnership (PPP) projects.

As part of the plans, the Russian Government, through its railway services agency, Geoservice, in collaboration with the University of Ghana (UG), is planning to establish a railways university in the country.

This came to light yesterday in Accra when the Ministries of Railways Development, Transport, and Finance interacted with investors at an event dubbed, ‘Market Sounding’ to discuss PPP arrangements for the development of the Eastern rail line and Boankra Inland Port Projects.

Government of Ghana is seeking an amount of $2 billion for the Boankra Inland Port and Eastern Railway Projects respectively through PPP on a Build, Operate and Transfer (BOT) basis.

PriceWaterCoopers (PwC), a global auditing firm, is acting as the transaction adviser.

Many foreign investors took part in the Market Sounding Event.

Speaking to BUSINESS GUIDE on the sidelines of the event on behalf of Geoservice, President of Ghana-Russia Business Development Council, Dr Lawrence Awuku-Boateng, said the railway university will provide technical education to Ghanaians in rail management so that they will be able to manage the country’s rail sector in the event that the foreign investors leave Ghana upon the expiration of their contracts.

He disclosed that Russia has the capacity to develop Ghana’s rail sector, saying that Russia has been a leading force in the global rail industry for over 100 years.

According to him, the Russian Government has already set funds aside to execute the various PPP projects in Ghana’s rail sector, adding that the monies would be given to Russian companies in Ghana who are interested executing such projects.

The Chinese government is also seeking to make substantial investment in the Ghana’s rail sector.

Already, the Chinese government has started sponsoring officials of the Ministry of Railways Development for various technical training programmes in China.

Overwhelming Proposals

BUSINESS GUIDE has gathered that several investors from across the world want to undertake various PPP initiatives in the rail sector domestically.

The Minister for Railways Development, Joe Ghartey, indicated that owing to the high number of investors who have expressed interest, the master plan could be executed in less than 30 years.

According to the Minister, the Eastern rail line would be completed by October 2020.

Local Content

Minister of Finance, Ken Ofori-Atta, in a statement, urged investors bidding for the various projects to form strong partnerships with Ghanaian businesses in line with the country’s local content policy.