Nigeria, China sign N5.5b mass transit deal .
Monday, 21 February 2011 00:00 By Dele Fanimo News - National .User Rating: / 0
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THE Federal Government and its Chinese counterpart have signed a N5.5 billion urban mass transit deal, with a view to boosting the Nigerian transport sector.
Under the scheme being brokered by the Urban Development Bank of Nigeria (UDBN) for the Nigeria Labour Congress (NLC) and Trade Union Congress (TUC), about 550 urban mass transit buses would be injected to the Nigerian transport system.
Already, NLC and TUC have signed a contract agreement with a Chinese firm, Yutong Hong Kong Limited, for the bus supply.
Money for the project fund is being drawn from the N10 billion intervention fund released to the UDBN as part of its mandate as an infrastructure development bank.
In an interview with The Guardian, Managing Director, UDBN, Adekunle Oyinloye, said upon realising the enormous challenges in the sector, government, through the Finance Ministry, released the N10 billion for mass transit operators in the country.
According to him, unlike the past schemes where buses were released to beneficiaries free of charge, the N10 billion is a revolving loan with five per cent interest rate and repayment plan of five years or less.
Oyinloye said half of the fund has been earmarked for the NLC and TUC, while the other half is meant for local councils and individuals.
His words: “Government provided N10 billion, half of which is meant for TUC and NLC, the other 50 per cent for the local government and private individuals. Twenty per cent of the N5 billion, which is N2 billion, is meant for state and local government, while 30 per cent is meant for private sector operators.”
Oyinloye, who said his bank was a Development Finance Institution (DFIO) focused on infrastructure, assured that due diligence had been embedded in the disbursement of the funds to ensure strict repayment plan.
According to him, for any private sector operator to access the fund, it must have a bank guarantee, credit insurance, an irrevocable standing payment order from state or local council and corporate guarantee that is credible.
Besides, he said organisations wishing to participate in the scheme must present their business plans showing that they are capable of operating the buses to access the fund.
He disclosed that to safeguard the fund and make sure that it was used for mass transit, the UDBN opted to acquire the buses and not release cash to beneficiaries.
The bank chief added: “So far, we have had a good number of private sector operators who have been able to access the fund. Companies like ABC Transport, Okeyson and Ekenedili Chukwu, have been able to meet our criteria and we have given them the buses. We don’t give out money, we acquire the buses and give to them.”
On the controversy that trailed the NLC-Yutong deal, Oyinloye explained that the bank was just a financial adviser in the pact, stressing that it did not introduce Yutong to NLC.
According to him, NLC had been dealing with Yutong long before the current deal, which involved the bank at advisory level.
The NLC had been sharply divided over the Yutong, China deal as some members accused the congress’ leadership of not following due process in the contract deal.
Some NLC affiliates also alleged that the deal smacked of graft, claiming that money exchanged hands during the signing of the contract agreement in China, where the union President, Abdulwaheed Omar; Chairman of Labour City Transport Service (LCTS) and Vice President, NLC
Monday, 21 February 2011 00:00 By Dele Fanimo News - National .User Rating: / 0
PoorBest
THE Federal Government and its Chinese counterpart have signed a N5.5 billion urban mass transit deal, with a view to boosting the Nigerian transport sector.
Under the scheme being brokered by the Urban Development Bank of Nigeria (UDBN) for the Nigeria Labour Congress (NLC) and Trade Union Congress (TUC), about 550 urban mass transit buses would be injected to the Nigerian transport system.
Already, NLC and TUC have signed a contract agreement with a Chinese firm, Yutong Hong Kong Limited, for the bus supply.
Money for the project fund is being drawn from the N10 billion intervention fund released to the UDBN as part of its mandate as an infrastructure development bank.
In an interview with The Guardian, Managing Director, UDBN, Adekunle Oyinloye, said upon realising the enormous challenges in the sector, government, through the Finance Ministry, released the N10 billion for mass transit operators in the country.
According to him, unlike the past schemes where buses were released to beneficiaries free of charge, the N10 billion is a revolving loan with five per cent interest rate and repayment plan of five years or less.
Oyinloye said half of the fund has been earmarked for the NLC and TUC, while the other half is meant for local councils and individuals.
His words: “Government provided N10 billion, half of which is meant for TUC and NLC, the other 50 per cent for the local government and private individuals. Twenty per cent of the N5 billion, which is N2 billion, is meant for state and local government, while 30 per cent is meant for private sector operators.”
Oyinloye, who said his bank was a Development Finance Institution (DFIO) focused on infrastructure, assured that due diligence had been embedded in the disbursement of the funds to ensure strict repayment plan.
According to him, for any private sector operator to access the fund, it must have a bank guarantee, credit insurance, an irrevocable standing payment order from state or local council and corporate guarantee that is credible.
Besides, he said organisations wishing to participate in the scheme must present their business plans showing that they are capable of operating the buses to access the fund.
He disclosed that to safeguard the fund and make sure that it was used for mass transit, the UDBN opted to acquire the buses and not release cash to beneficiaries.
The bank chief added: “So far, we have had a good number of private sector operators who have been able to access the fund. Companies like ABC Transport, Okeyson and Ekenedili Chukwu, have been able to meet our criteria and we have given them the buses. We don’t give out money, we acquire the buses and give to them.”
On the controversy that trailed the NLC-Yutong deal, Oyinloye explained that the bank was just a financial adviser in the pact, stressing that it did not introduce Yutong to NLC.
According to him, NLC had been dealing with Yutong long before the current deal, which involved the bank at advisory level.
The NLC had been sharply divided over the Yutong, China deal as some members accused the congress’ leadership of not following due process in the contract deal.
Some NLC affiliates also alleged that the deal smacked of graft, claiming that money exchanged hands during the signing of the contract agreement in China, where the union President, Abdulwaheed Omar; Chairman of Labour City Transport Service (LCTS) and Vice President, NLC
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