Nigeria spent over 1,000 percent of the Nigeria Railway Corporation (NRC)’s 2023 income on debt servicing, FIJ has gathered.

The NRC generated N6.07 billion in 2023, according to the Q4 railway transport report published by the National Bureau of Statistics (NBS) on Monday. Relative to 2022, this represents an 8.5 percent increase.

However, the 2023 annual debt service report reveals that Nigeria spent about $125.7 million to pay off debts incurred for rail-building projects in the same year.

To break it down, Nigeria spent about $46 million servicing debts incurred on the railway modernisation project in Idu Kaduna, $31.9 million on the modernisation of the Lagos-Ibadan railway and about $47.9 million on the Abuja light rail project.

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Using the 2024 naira-dollar exchange benchmark as a basis for estimation, the country spent about N100.64 billion on servicing debts incurred from railway-related capital projects in 2023. This would amount to about 1,450 percent of the revenue generated in that fiscal year.

Despite the heavy investments in these projects, passenger patronage declined significantly, falling by about 32 percent from what it was in 2022. By implication, passenger revenue dropped significantly.

“In Q4 2023, a total of 672,198 passengers travelled via rail system relative to 1,337,108 reported in the corresponding quarter of 2022, indicating a growth rate of -49.73%. The volume of goods/cargos transported in Q4 2023 stood at 119,286 tons, compared to 53,136 tons recorded in Q4 2022,” the NBS report read.

“In terms of revenue generation, N1.07 billion was received from passengers during the reference period, showing a decrease of 7.51% from the N1.15 billion recorded in the same quarter of the previous year.”

The report also revealed that revenue from cargo transport was majorly responsible for the 8.5 percent revenue increase in 2023. In total, the NRC recorded more than double the 2022 revenue in the 2023 fiscal year.

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Insecurity, ticket racketeering and poor labour conditions are the most commonly cited reasons for revenue fluctuations in the Nigerian transport sector.

For instance, FIJ has reported how instances of insecurity, ticketing corruption and infrastructural inadequacies cost the NRC passenger patronage.

In January, the NRC revealed that it was targeting N10.02 billion revenue in 2024. The corporation also made commitments to increase passenger patronage and the number of trips in 2024.