Rail investment in Ghana to fast-track further regional integration

 

The Ministry of Railways Development (MRD) has a budget of GHS636m ($137m) for 2019, up 16.9% from its allocation in 2018. The government is also looking to tap private sources of funding, such as its $2bn deal with China’s Sinohydro, wherein the firm will build vital infrastructure in exchange for bauxite development revenue. The MRD’s projects are centred around completing work that slowed during a period of sluggish infrastructure investment, launching new lines, and pushing forward tender processes and studies on major rail links that are currently in the pipeline.

This work will occur according to the framework of the MRD’s masterplan, which was designed to guide the rehabilitation, expansion and construction of 4675 km of rail lines at an estimated cost of $21.5bn. Of this sum, 1394 km of lines worth $7.8bn have been designated as priority projects and are scheduled for completion before 2020. The scale of investment should provide plentiful opportunities for private sector engagement in developing the railway network and associated infrastructure, as well as in providing related services.

Gearing Up

In 2019 the MRD expects to complete work on the 56-km line from Kojokrom to Tarkwa – the site of one of southern Ghana’s largest gold mines – via the Nsuta corridor. The project, which is funded in part by a $10m freight advance from the Ghana Manganese Company, will allow the operation of passenger services from Tarkwa to the port of Takoradi for the first time since 2007 and improve the reliability of the track linking the port to the manganese mining centre at Nsuta.

The rehabilitation of the Western Line will link Kumasi, the country’s second-largest city, to Takoradi, its predominant commodity export hub, via Manso, an iron ore mining centre north of the port. This phase will also include the rehabilitation of a branch linking the bauxite mines at Awaso to the Western Line via Dunkwa.

Meanwhile, feasibility studies for a range of major projects are under way, including the trans-ECOWAS line linking Togo to Côte d’Ivoire via the Ghanaian coast. While Ghana has mostly focused on regional connectivity with respect to its northern neighbours, the potential for east-west links that could accelerate regional integration in ECOWAS is not being neglected.

The local rail network in the Accra-Tema region has been improved considerably in recent years, and in 2019 the MRD expects to complete feasibility studies regarding metro and light rail transit systems in both Accra and Kumasi. Such networks could ease pressure on both cities’ roads and improve their liveability and competitiveness, though given the cities’ densities, construction would likely be lengthy and costly.

Going North

In 2019 the MRD also expects that it will commence the first stage of a 596-km line from Kumasi to Paga, a town on the Burkinabe border, as a concrete measure to improve north-south connectivity. The ministry is also due to select the concessionaire on the 1200-km line from the port city Tema to Burkina Faso’s capital, Ouagadougou, in 2019. This line, which is intended to provide access to the sea for landlocked countries to the north, is one of the masterplan’s most significant projects, as it is central to Ghana’s aim of developing as a regional transport and logistics centre.

As such, the country must compete with its coastal neighbours, including Côte d’Ivoire and Togo. While Ghana has benefitted from its political stability and internal security, inland infrastructure has been a point of weakness. Freight must utilise the country’s patchy road network in the absence of a rail system linking the coast to the northern border, which increases transit times and costs by an estimated 50%.

The Ghanaian and Burkinabe governments have formed a joint committee on the line’s development, with a focus on ensuring that its contractors deliver value for money at high standards. Due diligence for the feasibility study has been carried out by the Italian firm Team Engineering in partnership with Ghana’s Vision Consult, in a sign of the growing involvement of local firms in the development of transport infrastructure.

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The Report: Ghana 2019

Transport chapter from The Report: Ghana 2019

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