Fakoyejo OlalekanThe revenue of railway transport fell by N1.31 billion in the first quarter (Q1) of 2023, as the number of passengers dropped by 53.65% during the period.
In a report released by the National Bureau of Statistics (NBS), rail transport’s passenger revenue dropped by 63.02% to N768.44 million between January to March 2023.
Join our WhatsApp ChannelThis represents N1.31 billion shortfall in revenue, considering N2.08 billion turnover was generated from railway passengers in the corresponding period in 2022.
“In terms of revenue generation, N768.44 million was received from passengers over the period, lower by 63.02% relative to N2.08 billion in the same quarter of the previous year,” the report reads.
Although goods and cargo revenue increased during the review period to N181.27 million, surpassing the N90.96 million netted on the same service in Q1 last year.
NBS disclosed: “N181.27 million was collected in Q1 2023 as revenue from goods/cargos, up by 99.28% from N90.96 million received in Q1 2022.
“In addition, other receipts amounted to N34.17 million, indicating a decline of 41.02% in Q1 2023, from the N57.92 million collected in Q1 2022.”
More goods used Nigerian trains than humans
The drop in passenger revenue was on the back of a 53.65% decline in passenger growth, as 511,374 passengers stopped using the train in the first three months of this year.
In Q1 2023, only 441,725 passengers travelled via the rail system, against the 953,099 passengers reported during the same period last year.
However, amid the decline in passenger volume, more goods travelled via train in the first quarter this year than in 2022 period.
“The rail transportation data for Q1 2023 showed that a total of 441,725 passengers travelled via the rail system in Q1 2023, lower than the 953,099 reported in the corresponding quarter of 2022, representing a growth rate of -53.65%.
“In addition, 59,966 tons of goods were transported in Q1 2023, compared to 39,379 tons reported in Q1 2022.”
Why did train passenger volume dropped in Q1 2023?
In the first quarter of 2023, the Central Bank of Nigeria (CBN) phased out the old naira notes, informing the country that only the redesigned banknotes should be accepted for goods and services.
The implementation of this directive led to a naira shortage, as the CBN failed to print sufficient banknotes. Also, the CBN asked that Nigerians should use electronic systems for transactions, but digital payment channels couldn’t withstand the migration from physical cash to electronic transfers.
Due to the shortage of cash, many couldn’t board a train, as the railway service management insisted on the redesigned banknotes and refused electronic transfers. This forced many to use alternative transportation instead.
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