Monday, 26 February 2018

Accra-Ouagadougou railway to create business opportunities

Image result for Accra-Ouagadougou railway

Adnan Adams Mohammed

Even as the transaction advisor is yet to be named for the construction of the Accra-Ouagadougou, several businesses have been identified on that stretch.

Currently, it is estimated that, about one million tonnes of freight transited through Ghana ports (Tema and Takoradi ports) to Burkina Faso during the third quarter of 2017.

Breakdown has been given as; 176,000 tonnes of cargo transited through Takoradi port and 700,000 tonnes passed through the Tema port.

Business analysts have expressed optimism that the construction of a 1,100-kilometre railway project from Accra to Ouagadougou from 2020 would improve freight and boost economic activities between the two countries.

It is also expected that, more business opportunities will be created along the railway line for  investors and settlers along the route. Petty trading, hospitality business, transport supply and value chain business among others offer potential business opportunities along the railway line when completed. 
Image result for Accra-Ouagadougou railway

The business community therefore hopes the railway interconnectivity project sees the light of the day.

The Railway Interconnectivity Project is to be undertaken as Build, Operate and Transfer (BOT) arrangement under a Public Private Partnership (PPP) initiative.

According to the Railway Master Plan, the country intended to construct 4,000 kilometres of rail lines across the country, which is supposed to be completed by 2047.

Governments of the two neighboring countries, Ghana and Burkina Faso, at a Joint Committee of Experts on the Railway Interconnectivity Project, agreed to engage the services of a Transaction Advisor to assist in the implementation.

In a communiqué issued by the Joint Committee of Experts and signed by Hon Joe Ghartey, the Minister for Railways Development and Mr Vincent Dabilgou, the Minister of Transport, Urban Mobility and Road Safety on behalf of the governments of Ghana and Burkina Faso respectively, stated that, the Transaction Advisor would assist the governments of the two countries to review and undertake various studies, including survey works and procurement processes in line with applicable laws of the two countries.

The terms of reference for the Transaction Advisory services was drafted by the Ghanaian side and presented to the Burkinabe team at the meeting, which the latter agreed to in principle.

The Advisor would engage a private sector investor to develop a railway interconnectivity project between the Port of Tema and Ouagadougou on a Build, Operate and Transfer (BOT) basis.

 The Committee has since reviewed the draft Terms of Reference for engaging the private sector partner extensively and has adopted it for implementation.

The communiqué said the Burkinabe side notified members of the JCE that, two private sector partners, including Dubai Touch and African Global Development SARL, had shown interest, but strongly recommended the latter as a preferred choice for the project.

The Committee noted that, the Burkinabe side recommended African Global Development SARL because it had already conducted feasibility study on the proposed line, including drawings on the route and had agreed to undertake the project on a BOT model, and is in position to arrange funding for the project.

The Committee, which comprises of technocrats from the two countries, is supposed to meet every two weeks for deliberations geared towards the implementation of the project.

In view of the size and nature of the project, the committee sees the need for the development of a Treaty between the two countries.

In this regard, two legal officers from Ghana and Burkina Faso have been tasked to review a draft treaty for discussion in the next meeting in Ouagadougou on March 12, 2018.

The JCE would meet again on March 12, this year, in the Burkinabe Capital, Ouagadougou, for further deliberations, and among other things, receive a presentation from the potential Transaction Advisor, review and adopt the Terms of Reference for the Transaction Advisor, as well as review a draft Treaty between the two countries.

The meeting would also outline the timelines for selecting the Transaction Advisor and private sector partner and preparation of the final report.