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Business News of Friday, 27 March 2015

Source: B&FT

Gov’t plans US$30 billion Accra-Kumasi high speed rail

Minister of State in charge of Public-Private Sector Rashid Pelpuo has engaged the services of a New York investment bank to devise a request for proposal (RFP) for the construction of a multi-billion dollar high speed rail system to connect Accra and Kumasi.

The bank, Chesterfield Faring Ltd., is also expected to design another proposal covering an elevated mass transit commuter system connecting a newly-developed trade zone to the Kotoka International Airport (KIA). A press release issued by the bank said, when completed, the bullet-train from Accra to Kumasi will allow traffic to arrive from Accra to Kumasi in less than 1.4 hours from station to station.

“The RFP will cover a 120,000 square metre transit oriented development (TOD) in Accra plus a 65,000 square metre TOD in Kumasi. Each TOD will include shopping, public and private parks and gardens, office towers, a hotel with conference spaces, and the balance being residential towers (1,000 units) with full amenities,” the statement said.

According to the bank, initial estimates for Phase 1 of the RFP is US$12billion growing to US$30billion over the balance of the decade. Bids will be considered after the master-plan of the rail and TOD are completed in the RFP. Lawrence J. Selevan -- CEO of the investment bank who was in Accra recently, met with the Departments of Transportation, Housing and Finance to coordinate underwriting of the RFP.

“I believe that Ghana is ready for a state-of-the-art mass transit system that will speed up the commute for millions of everyday citizens in both Accra and Kumasi. Also, the US$30billion should have a 3.0-3.5 multiplier effect -- increasing immediate economic activity to almost US$100billion before end of the decade, as well as the aftermath of the investment increasing GDP by almost 3% per annum, growing to over US$2billion annually. The immediate impact will be apparent as vehicular congestion allows more access and an easier flow of traffic, both for commuters and freight transportation."

Mr. Pelpuo remarked in a statement: “We sought out the best firm with the greatest vision to improve the everyday lives of all of our citizens through an improved affordable transit system. We will be building beautiful sustainable 'cities within our city' that will be a model for all of Africa into the future".