The OPEC Fund for International Development has signed a $5 million loan agreement with Ghana to co-finance the re-commissioning of the Accra-Tema railway line.
The project falls within the framework of government's aim to provide a reliable and alternative system of transport and address the growing demand for mass rail services.
Ghana's urban population, especially in the capital Accra, has burgeoned, with annual growth rates estimated as high as 4%. The corresponding rise in vehicle transport has caused major traffic congestion and excessive wear and tear on the road network.
The project will rehabilitate the abandoned Accra-Tema rail line, which totals 31.7 km in length. Works will include refurbishment of rails, sleepers and railway cars, and modernization of signaling and telecommunication equipment. Nine railway stations will be renovated, and safety and security features such as fences and pedestrian crossings built. A stock of replacement parts and tools will also be procured.
The renovated railway system will save commuters a vast amount of travel time, as the bus journey from Accra to Tema during peak traffic hours can take up to two hours - a trip only 30 minutes long by rail. It is estimated that, on the average, 4.1 million passengers per year will use the rail line, which will free up roads and result in fewer accidents and less pollution.
The Fund has extended 16 other pubic sector loans to Ghana. Of these, one loan was extended for balance of payments support, one provided debt relief under the Heavily Indebted Poor Countries Initiative, while 14 others supported projects in the transportation, national development banks, multi-sectoral, water supply and sewerage, health and education sectors. Additionally, one loan has been approved for the private sector in support of the health sector.
Lending terms include an interest rate of 1% per annum, with an annual service charge of 1% on amounts withdrawn and outstanding; maturity of 20 years, including a grace period of five years.
