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Minister of Railways Development, Joe Ghartey, has challenged players in Ghana’s insurance industry to support government to raise $1 billion locally for the development of the railway sector.
According to Mr. Ghartey, “Getting the finance to mitigate the risk of financing the construction and operation of the railways sector requires the insurance sector to play a key part.”
“I was just talking to Mr. Ankra, and I challenged him to work with us to put together a product which will be able to raise $1 billion from Ghana for the railway sector backed by the insurance sector which would provide the guarantee.”
“Today, all monies or most of the monies that come out of China are insured by Sinosure so why don’t we have our local insurance sector participating in potentially a billion dollar business which is the railway sector?”
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He said the time has come for insurers to stop limiting themselves to mostly insuring the importation of goods.
“My challenge to you is to participate in guaranteeing the financing of the sector too,” he said.
The Minister said the past two years have been busy for the railway sector, which is working to meet the President’s vision of extending the rail network to Paga.
He reiterated that Ghana and Burkina Faso were in the process of constructing a railway network from Tema to Ouagadougou to help in the transportation of goods between the two countries.
“Twelve companies have been shortlisted after expression of interest, and as I speak to you, there is a request for qualification on my table and once we vet it, we will go to the stage of procurement. This is going to be by BOT and companies are already expressing interests because it’s a bankable project, it makes financial sense.”
The level of interest of the insurance industry in the railway sector leaves much to be desired.”
He disclosed that “the Railway Ministry and the insurance sector, under the National Insurance Commission, set up a working group which will work together to see how we can use insurance to support this investment the President of the Republic of Ghana is seeking to make. If you are not adverse to it, perhaps we should be signing an MoU in January where we have a small working, who will come out to advise on how we use insurance to support this sector.”
“We have to have the insurance sector back the financing of this project. We have to transform this nation and we don’t have a choice. I am of the strong belief that the railway sector affords us a unique opportunity to learn as a nation how to do big ticket infrastructure project.”
“In fact, we are on the way to attaining this.”
