Political News

Amaechi accuses Chinese firm of breaching contract agreement

Mr. Rotimi Amaechi, the Minister of Transportation

Rotimi Amaechi, the Minister of Transportation, has revealed that the Chinese Railway Rolling Corporation (CRRC) which was supposed to deliver some coaches to Nigeria in June this year has breached its contract agreement.

The Minister who led a delegation to China to inspect the work at the firm noted that the Chinese firm had failed to meet the contract delivery date as agreed.

CRRC was supposed to deliver 10 coaches that will be deployed on the Abuja-Kaduna and Lagos- Ibadan rail lines.

“We need the coaches by June latest. We need coaches that can carry men from one point to another and we need a minimum of 10 coaches now out of the 64. I requested for 10 coaches now because we need to improve on the Kaduna-Abuja line.

“If the 10 (coaches) don’t come, there is nothing I can do but they have to come because they have to manufacture for us to use in Kaduna-Abuja and again Lagos-Ibadan, which will soon be ready. We also have to ensure that we get coaches that we can use pending when they finish the construction of the 64 coaches,” Amaechi said.

“The pace of construction is slow and they need to improve on it. In fact, the contract has expired; we may not have paid all the money but we paid quite a substantial sum and, therefore, they should construct speedily.

“The contract was signed in December 2017 and was supposed to expire in February 2019. The time has expired and there is a breach of contract but we will look at what the law says because more than one third of the money has been paid.”

The Minister also visited the CRRC Shandong facility to inspect the cargo wagons being built for Nigeria.

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He noted that he had a verbal agreement with the China Civil Engineering Construction Corporation (CCECC) to localize the railway industry in Nigeria in order to create more jobs for Nigerians.

“We had a verbal agreement for them to produce 15 per cent of the coaches, locomotives and wagons. They came back and said it was too expensive to establish locomotives and coaches factory and that we can start with the wagon and do 100 per cent assembly in Nigeria for the first five years. After the first five years, they will now build a factory that will manufacture wagons in Nigeria.

“It is not part of the contract we signed in 2017 but I insisted that for me to sign, they must localise it to create more jobs and reduce the expenditure of foreign exchange. Instead of going to buy dollars, you pay the Chinese in their local currency.

“We have to go further to ask them if we can own it. We have not talked about ownership but what we said was localise it. Although they are using their profit to build it, you can make them hand over the ownership to Nigeria. As for the assembly plant, I intended for Zaria but they chose Kajola in Ogun state.”

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