Nigeria’s rail transportation sector is experiencing significant growth, with revenues rising to ₦1.69 billion in the second quarter of 2024, a 53.14% increase compared to ₦1.10 billion in the same period of 2023.
This information was revealed in a report published by the National Bureau of Statistics (NBS) on Thursday, highlighting the increasing adoption of rail services by Nigerians.
According to the report, 689,263 passengers used the rail system in Q2 2024, marking a 45.38% growth from the 474,117 passengers recorded in the second quarter of 2023. The surge in passenger numbers underscores the growing preference for rail travel, which has contributed significantly to the revenue boost.
The movement of goods via rail also saw notable growth. In Q2 2024, a total of 143,759 tons of goods were transported, a sharp rise from the 56,936 tons moved in the same period in 2023. Revenue generated from goods transport via rail increased by an impressive 206.68%, reaching ₦537.36 million, up from ₦175.22 million in Q2 2023.
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Additionally, pipeline transportation of goods contributed to the sector’s revenue growth, with 5,940 tons moved in Q2 2024, compared to 2,856 tons in Q2 2023. This segment generated ₦42.08 million in revenue, a substantial increase from ₦12.81 million in the corresponding period of the previous year.
Other revenue streams for the Nigerian Railway Corporation (NRC) totaled ₦994.68 million in Q2 2024, a remarkable surge of 5,206.68% from the ₦18.74 million recorded in the same quarter of 2023.
Despite the revenue growth, Nigeria’s rail sector faces challenges in debt servicing. In the first quarter of 2024, the country spent 2,470% more on railway debt servicing than it earned from rail services.
The report also highlighted that while revenues from passenger transport have been on the rise, driven by increased usage of the Lagos-Ibadan rail line, freight transport revenues have declined, signaling a shift in demand patterns within the sector.
As Nigeria continues to invest in its railway infrastructure, the sector remains a critical part of the country’s broader economic strategy, with the potential to support both passenger mobility and industrial transportation needs.
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