China Eximbank provides $157 million preferential buyer’s credit for Supply of Rolling Stocks and Depot Equipment for Abuja Light Rail Project (Linked to Record ID#1851)

Project narrative

In 2012, China Eximbank issued a $500 million loan to the Government of Nigeria for the construction of the Abuja Light Rail Network Project (as captured via Record ID#1851). Then, on May 29, 2018, China Eximbank and the Government of Nigeria signed a $157,001,049.89 preferential buyer’s credit (PBC) agreement for the Supply of Rolling Stocks and Depot Equipment for Abuja Light Rail Project t (as captured via Record ID#73400). The PBC (loan) carried the following borrowing terms: a 20 year maturity, a 7 year grace period, and a 2.5% interest rate. The final maturity date of this loan is March 21, 2038. As of December 31, 2020, Nigeria’s Debt Management Office (DMO) reported that the China Eximbank PBC (loan) had not yet disbursed and the borrower had not made any interest or principal repayments to the lender. The proceeds of the loan were to be used by the borrower to partially finance a commercial contract between the Government of Nigeria and China Civil Engineering Construction Company (CCECC), which was signed on May 23, 2017. The purpose of the project, which is also known as Phase 2 of the Abuja Light Rail Project, is to facilitate the acquisition of 12 trains and 48 locomotives and rolling stock to support the Abuja Light Rail. CCECC is the EPC contractor responsible for project implementation. The project formally commenced on September 5, 2018. However, it reportedly stalled in 2020. Abuja Light Rail was shuttered from 2020 to 2023, ostensibly to slow the spread of Covid-19. In August 2023, Bloomberg reported that '[t]rain cars are locked away at a depot. Cavernous stations fully equipped with escalators, ticket offices, cameras and scanners stand empty, overseen by bored security guards. The faux leather couches in the VIP area are covered in bird and bat droppings.' Rowland Ataguba, an adviser to the Nigerian Government on rail strategy, told Bloomberg that '[i]t’s an abandoned project. [...]. Quite clearly there was no plan on how to run the operations before they built it.' Mohamed Lawal Shaibu of Envicons Teams Ltd., an urban planning consultant in Abuja, told Bloomberg that the project 'has been very terribly executed' and '[t]he [railway] line basically avoided where people are, where people live, where people go.' Bloomberg characterized the project as 'a lesson in how not to create a mass transit system.' Then, in September 2023, CCECC pledged to complete the project's second phase by May 2024. The Abuja light rail network was ultimately re-opened on May 29, 2024 and the Government of Nigeria immediately announced free rides for commuters.