CHAPTER ONE

1.0 Background of the Study

The role of transportation in economic development is widely acknowledged, with rail transport serving

as one of the most significant contributors to regional and national growth. Rail systems are highly

efficient for moving large volumes of goods and passengers over long distances, making them an integral

part of trade facilitation, industrialization, and urbanization. In Nigeria, where road congestion, poor road

maintenance, and high logistics costs are ongoing challenges, rail transport offers a vital alternative to

enhance economic transformation.

Globally, rail transport has driven economic modernization since the Industrial Revolution. In countries

like the United States, Germany, and China, rail networks have significantly reduced transportation costs,

connected rural and urban areas, and supported industrial growth. Modern high-speed rail systems in

Japan and France further demonstrate the potential of rail transport to revolutionize mobility and logistics,

creating broader economic benefits through job creation, reduced environmental impact, and enhanced

regional integration.

In Nigeria, rail transport dates back to 1898 with the construction of the Lagos-Ibadan railway, a critical

link designed to connect Lagos, the country's primary port city, to the agricultural hinterlands of the

southwest. The railway became a lifeline for moving agricultural products such as cocoa, rubber, and

palm oil from Ibadan to Lagos for export. Over time, Nigeria’s rail infrastructure expanded, culminating

in the establishment of the Nigerian Railway Corporation in 1955 to oversee operations. However, the

decline of rail services in the late 20th century, due to underinvestment, poor maintenance, and increased

competition from road transport, disrupted the efficiency of freight and passenger services, negatively

affecting regions like Ibadan that relied on rail connectivity for economic activities.
As one of Nigeria's largest cities, Ibadan holds historical and economic significance. It has long been a

hub for trade, agriculture, and industry, with its development deeply tied to transportation infrastructure.

The Lagos-Ibadan railway played an important role in facilitating trade by connecting farmers and traders

in Ibadan to Lagos, enabling the movement of goods efficiently. Rail transport has also supported

industrialization by reducing the cost of moving raw materials and finished goods, while enhancing

regional connectivity by integrating rural areas with urban centers.

Recent years have witnessed efforts to revitalize rail transport in Nigeria as part of broader strategies to

overcome transportation challenges and stimulate economic growth. The Lagos-Ibadan Standard Gauge

Railway, inaugurated in 2021, is a landmark project under the railway modernization initiative. This 157-

kilometer line is expected to provide faster, safer, and more efficient transportation for passengers and

freight. For the Ibadan region, this railway is anticipated to lower transportation costs, stimulate economic

activity through improved logistics, and alleviate road congestion, particularly along the overburdened

Lagos-Ibadan Expressway.

While the benefits of rail transport for economic growth are apparent, challenges remain. Issues such as

limited last-mile connectivity, inadequate rail coverage, and funding constraints hinder the optimization

of rail transport. Additionally, public awareness and adoption of rail services as a preferred mode of

transport are relatively low. Overcoming these challenges will require coordinated efforts involving

government agencies, private sector stakeholders, and local communities. Despite these hurdles,

significant opportunities exist for leveraging rail transport to achieve sustainable development in the

Ibadan region. Integrating rail systems with other modes of transport and creating supporting

infrastructure, such as freight terminals and industrial parks, can maximize economic gains and foster

regional inclusion.

Examining the relationship between rail transport and economic growth in Ibadan is vital for

policymakers, urban planners, and investors. Although the Lagos-Ibadan railway is celebrated as a key
development in Nigeria’s transport sector, limited empirical research exists on its economic impact. This

study seeks to bridge this gap by analyzing how rail transport influences trade, industrial activities,

employment, income levels, and regional integration in the Ibadan region.

1.2 Statement of the Research Problem

Transportation infrastructure is a cornerstone of economic development, playing a vital role in facilitating

trade, enhancing mobility, and fostering regional integration. Rail transport, in particular, is recognized

globally as an efficient means of moving large volumes of goods and people over long distances. In

Nigeria, the historical significance of railways, such as the Lagos-Ibadan railway, is undeniable, as it has

contributed to economic development by connecting agricultural, industrial, and commercial centers.

However, despite its potential, the state of rail transport in Nigeria has deteriorated over time, creating

significant challenges for the regions it serves.

Ibadan, as a major economic hub in southwestern Nigeria, has historically benefited from its connection

to the Lagos-Ibadan railway. The city is strategically located, serving as a gateway between Lagos, the

nation’s commercial capital, and the hinterlands of southwestern Nigeria. Its economy has traditionally

relied on agriculture, trade, and manufacturing, all of which require efficient transportation networks. The

decline of rail transport over several decades has had adverse effects on Ibadan’s economic activities.

Goods that once moved seamlessly to and from the city are now hampered by inadequate transportation

options, increased logistics costs, and the over-reliance on road networks that are often congested and

poorly maintained.

The recent revitalization of rail transport in Nigeria, particularly through the Lagos-Ibadan Standard

Gauge Railway, presents a significant opportunity to address these challenges. The new railway line

promises to enhance trade, reduce transportation costs, and alleviate road congestion. However, there is

limited empirical evidence to demonstrate the extent to which this new railway has impacted the
economic growth of Ibadan and its surrounding region. Questions remain about whether the revitalized

railway has addressed long-standing inefficiencies in freight movement, improved access to markets, or

stimulated local industries.

In addition, while the Lagos-Ibadan railway is expected to contribute to economic growth, several

challenges persist. Last-mile connectivity remains a major issue, as the railway does not adequately

integrate with other modes of transportation, limiting its accessibility for many residents and businesses.

The high cost of logistics and limited freight handling facilities further constrain the full utilization of the

railway. Moreover, there is a lack of data on the socio-economic benefits of rail transport for Ibadan’s

population, including its impact on job creation, income levels, and access to services. Without a

comprehensive understanding of these issues, it becomes difficult to assess whether the railway is

achieving its intended economic objectives.

Another dimension of the problem is the environmental and social sustainability of the railway project.

While rail transport is generally considered more environmentally friendly than road transport, concerns

about land acquisition, displacement of communities, and the long-term maintenance of rail infrastructure

raise questions about the sustainability of rail investments in Nigeria. These issues are particularly

relevant in the context of Ibadan, where rapid urbanization and population growth have placed additional

pressure on transportation systems and urban planning.

The limited integration of rail transport into the broader regional economy is another challenge. For the

Lagos-Ibadan railway to have a meaningful impact on economic growth, it must be supported by

complementary infrastructure, such as industrial parks, logistics hubs, and improved road networks. The

lack of such infrastructure reduces the efficiency of rail transport and limits its potential to drive

economic transformation in the Ibadan region. Furthermore, disparities in access to rail services across

different socio-economic groups raise concerns about inclusivity, as many low-income residents may not

benefit from the railway's services.

This study is motivated by the need to address these gaps in knowledge and practice. It seeks to provide a

comprehensive appraisal of the impact of rail transport on the economic growth of Ibadan, focusing on its

contributions to trade, industrial development, and regional integration. The research also aims to identify

the challenges and opportunities associated with the revitalization of rail transport in the region, with a

view to informing policy and investment decisions. By examining the nexus between rail transport and

economic growth, this study will contribute to the broader discourse on sustainable transportation and

regional development in Nigeria.

1.3 Justification of the Study

Transportation is an essential driver of economic growth and regional development, providing the

necessary infrastructure for trade, industrial activities, and the movement of goods and people. In this

context, rail transport plays a particularly critical role due to its capacity to handle large volumes of

freight and passengers efficiently and at a lower cost compared to road transport. For developing

countries like Nigeria, where infrastructure deficits and logistical inefficiencies significantly constrain

economic activities, the revitalization of rail transport presents a unique opportunity to address these

challenges and stimulate regional growth. This study is justified by its potential to contribute to the

understanding of how rail transport can influence economic transformation, specifically in the Ibadan

region.

The Ibadan region is of significant economic importance, serving as a major trade and industrial hub in

southwestern Nigeria. Historically, the Lagos-Ibadan railway contributed to the development of the city

by facilitating the movement of agricultural produce and manufactured goods. However, the decline of

rail transport over the years has disrupted supply chains, increased transportation costs, and placed

excessive reliance on road networks. These issues have had a profound impact on Ibadan’s economic

landscape, reducing the competitiveness of its industries and creating barriers to market access for traders
and farmers. By examining the impact of rail transport on economic activities in Ibadan, this study seeks

to provide insights into how the city can reclaim its role as a regional economic powerhouse.

The revitalization of rail transport, particularly through the Lagos-Ibadan Standard Gauge Railway, is a

significant development in Nigeria’s transportation sector. This project is expected to have far-reaching

economic implications, including reduced logistics costs, enhanced connectivity, and improved access to

markets. Despite these anticipated benefits, empirical research on the economic impact of the railway

remains limited. Understanding how rail transport influences trade, industrial growth, employment, and

income levels in Ibadan is crucial for assessing the effectiveness of this infrastructure investment. This

study will provide much-needed evidence to support decision-making by policymakers, investors, and

other stakeholders.

This research is also justified by the need to address the persistent challenges associated with rail

transport in Nigeria. While the Lagos-Ibadan railway represents a step forward, several issues threaten to

undermine its potential impact. For instance, inadequate last-mile connectivity limits the accessibility of

the railway for businesses and residents, while the high cost of logistics continues to constrain its

competitiveness. Additionally, the lack of complementary infrastructure, such as freight terminals and

industrial parks, reduces the efficiency of rail transport and limits its integration into the regional

economy. By identifying these challenges and proposing practical solutions, this study aims to inform

strategies for optimizing the economic benefits of rail transport.

1.4 Research Questions

This study is guided by a set of research questions aimed at exploring the relationship between rail

transport and economic growth in the Ibadan region. These questions will address the various dimensions

of the study, including the impacts, challenges, and opportunities associated with the Lagos-Ibadan

railway. The research questions include the following:

 1. How has the revitalization of the Lagos-Ibadan railway influenced economic activities, such as

trade and industrial growth, in the Ibadan region?

2. What is the impact of the Lagos-Ibadan railway on employment generation and income levels in

the Ibadan region?

3. To what extent has rail transport reduced transportation costs and improved logistics efficiency

for businesses in the region?

4. How does rail transport compare to other modes of transportation in terms of cost, accessibility,

and efficiency for economic activities in Ibadan?

5. What are the challenges associated with the utilization of the Lagos-Ibadan railway for freight

and passenger services?

1.5 Aim and Objectives

The overarching aim of this study is to appraise the impact of rail transport on economic growth in the

Ibadan region, with a specific focus on the Lagos-Ibadan railway. The research seeks to assess how rail

transport contributes to economic activities, addresses logistical challenges, and fosters regional

development, while identifying areas for improvement to maximize its benefits. To achieve this aim, the

study has the following specific objectives:

1. To evaluate the impact of the Lagos-Ibadan railway on trade and industrial growth in the Ibadan

region.

2. To assess the contribution of rail transport to employment creation and income generation in the

region.

3. To investigate the role of rail transport in reducing logistics costs and improving supply chain

efficiency for businesses.

4. To analyze the comparative advantages of rail transport over other transportation modes in

facilitating economic activities in Ibadan.

 5. To identify the challenges associated with the utilization and integration of the Lagos-Ibadan

railway for freight and passenger services.

1.6 Scope of the Study

This study focuses on appraising the relationship between rail transport and economic growth in the

Ibadan region, using the Lagos-Ibadan railway as a case study. It examines the economic, social, and

logistical impacts of rail transport, with an emphasis on trade, industrial activities, employment, and

regional integration. The geographical scope includes the city of Ibadan and its surrounding areas, which

are directly or indirectly influenced by the operations of the Lagos-Ibadan railway. This region is

significant due to its historical, economic, and strategic importance as a trade hub and as a vital link

between Lagos and the hinterland.

The study's temporal scope encompasses both historical and contemporary perspectives. It considers the

historical role of rail transport in Ibadan's economic development, tracing its contributions from the

colonial era to its decline in the late 20th century. Furthermore, it focuses on the recent revitalization of

rail transport, particularly the introduction of the Lagos-Ibadan Standard Gauge Railway, assessing its

impact on the region's economy since its inauguration in 2021. This dual temporal approach enables a

comprehensive understanding of how rail transport has evolved and how it currently influences economic

activities.

1.7 Study Area

The study area for this research is the Ibadan region, located in southwestern Nigeria, with a particular

focus on the city of Ibadan and its surrounding environment. Ibadan, historically the capital of the old

Western Region and now the capital of Oyo State, is one of the largest and most significant urban centers

in Nigeria. The city has a rich history dating back to the 19th century, when it grew rapidly as a trade and
political center. The strategic location of Ibadan at the crossroads of several key transportation routes has

contributed to its economic prominence.

Geographically, Ibadan lies approximately 130 kilometers northeast of Lagos, the commercial hub of

Nigeria, and is connected to Lagos by the Lagos-Ibadan railway. This central location makes Ibadan a key

nexus between Lagos, the nation's port, and the agricultural and industrial hinterlands of the southwest.

Ibadan's role as a transport and trade center is further enhanced by its accessibility via road networks that

connect the city to other parts of Nigeria, such as the northern regions and the rest of the southwest.

The city’s economy has historically been based on agriculture, with crops like cocoa, yam, cassava, and

maize being grown in surrounding rural areas. Ibadan is also home to a growing manufacturing sector,

with industries in food processing, textiles, cement, and chemicals. Over time, the city has developed into

a major service hub, with a well-established retail sector, educational institutions, and a variety of

financial and administrative services. However, the economic structure of Ibadan remains closely tied to

agriculture, with many residents dependent on farming and the trade of agricultural products.

The Lagos-Ibadan railway, which passes through Ibadan, has historically been a critical infrastructure in

the city’s economic development, connecting it to Lagos and other regions. For decades, the railway

played a key role in facilitating the movement of goods, including agricultural produce like cocoa and

palm oil, which were crucial to the region’s economy. However, over time, the decline of the rail system,

coupled with the underdevelopment of supporting infrastructure, led to increased reliance on road

transport, which became less efficient due to road congestion and poor maintenance.
 CHAPTER TWO

2.0 Literature Review

The relationship between transportation infrastructure, particularly rail transport, and economic

development has been widely explored in the literature. Rail transport, as one of the most efficient modes

of long-distance transport, plays a critical role in reducing transportation costs, enhancing trade, and

fostering industrial development. This literature review seeks to examine existing research on the role of

rail transport in economic growth, with a specific focus on its impact on trade, industrial activities,

logistics, employment, and regional development. The review will also explore the challenges and

opportunities associated with rail transport in the context of developing countries, particularly in Africa,

with case studies and research that shed light on the implications for Nigeria and the Ibadan region.

The Role of Rail Transport in Economic Growth

Rail transport is considered a backbone of economic growth due to its ability to move large volumes of

goods and people over long distances efficiently. According to Banister (2005), the development of

transportation infrastructure is closely linked to economic performance, as it facilitates the movement of

raw materials, finished goods, and labor, all of which are necessary for industrial growth. Railways are

especially crucial in developing economies, where they offer a cost-effective alternative to road transport,

which often faces congestion and maintenance challenges.

In Nigeria, rail transport has historically been central to the economy, particularly in the transportation of

agricultural products like cocoa, palm oil, and timber, as well as industrial goods. The decline of the rail

network in the latter half of the 20th century, however, led to increased reliance on road transport, which

has proven to be inefficient and costly due to factors like road deterioration, congestion, and insecurity.

As Akinwale (2019) observes, the revitalization of the Nigerian railway system, particularly the Lagos-

Ibadan Standard Gauge Railway, offers a potential solution to these challenges, with the promise of

reducing logistics costs, improving supply chain efficiency, and stimulating regional trade.

Rail Transport and Regional Economic Integration

Regional integration is an important aspect of economic development, as it allows for the free movement

of goods, services, and labor across borders, fostering trade and investment. Rail transport plays a vital

role in this process, as it connects distant regions, facilitates cross-border trade, and promotes economic

cooperation. In sub-Saharan Africa, rail networks have historically been key to linking landlocked

countries to seaports and facilitating the movement of goods across national borders.

Economic Impacts of Rail Transport in Nigeria

Several studies have examined the specific economic impacts of rail transport in Nigeria. According to

Bello (2017), the revival of rail services in Nigeria can reduce transportation costs by up to 40%, which

would have significant implications for the cost of doing business in the country. Rail transport can also

alleviate the pressure on Nigeria’s overburdened road network, which is often plagued by congestion,

poor road conditions, and high maintenance costs. By shifting a portion of freight traffic from road to rail,

Nigeria can improve its logistics efficiency, reduce fuel consumption, and lower greenhouse gas

emissions.

The Lagos-Ibadan Standard Gauge Railway is expected to have significant economic benefits for the

region. A study by Oloyede (2020) suggests that the new rail line could lead to the creation of thousands
of jobs in the construction, operation, and maintenance of the railway, contributing to local economic

development. Furthermore, the reduced cost of transportation is likely to make Ibadan more attractive to

businesses, particularly those involved in manufacturing and trade. In addition, the availability of

affordable and reliable rail services could enhance access to regional markets, promote agricultural

exports, and encourage foreign investment.

CHAPTER THREE

Research Methodology

The research methodology for this study is designed to thoroughly assess the impact of rail transport on

economic growth in the Ibadan region, with a particular focus on the Lagos-Ibadan railway. Given the

multifaceted nature of this study, a mixed-methods approach will be employed, combining both

qualitative and quantitative data collection techniques to provide a comprehensive analysis of the

subject matter. This approach ensures that the study captures a broad range of perspectives and allows

for triangulation of findings, improving the reliability and validity of the results.

Research Design

This study adopts a descriptive and exploratory research design. The descriptive aspect involves a

detailed analysis of the current state of rail transport in the Ibadan region, focusing on its infrastructure,

operations, and economic implications. The exploratory component seeks to identify potential links

between rail transport and various economic indicators, such as trade volume, employment, industrial

development, and logistics efficiency. Through this design, the study aims to generate insights into how

the revitalized Lagos-Ibadan railway has influenced the economic landscape of the region and what

further interventions might be necessary to maximize its benefits.

Data Collection Methods

The study will use both primary and secondary data sources. Primary data will be gathered through

surveys, interviews, and focus group discussions, while secondary data will include published reports,

academic papers, government documents, and other relevant literature.

1. Surveys

Structured surveys will be distributed to key stakeholders in the Ibadan region, including

business owners, transport operators, government officials, and local residents. These surveys

will collect data on the perceived impact of the Lagos-Ibadan railway on economic activities,

including changes in transportation costs, employment, trade, and access to markets. A sample

size of approximately 200 participants will be targeted, with respondents selected from different

sectors, such as agriculture, manufacturing, retail, and transport.

The survey will include both closed-ended questions, which will allow for quantitative analysis, and

open-ended questions to capture qualitative insights. Some key areas of focus in the survey will include:

o Changes in transportation costs for goods and passengers

o Impact on business operations and supply chain efficiency

o Employment changes within industries linked to rail transport

o Perceived benefits and challenges of using rail transport

o General public perception of the Lagos-Ibadan railway’s impact

2. Interviews

Semi-structured interviews will be conducted with key informants, including government

officials, railway operators, transport experts, and business leaders in Ibadan. These interviews

will provide in-depth insights into the operational, economic, and policy aspects of the Lagos-

Ibadan railway. The interviewees will be selected based on their expertise, involvement in rail
 transport, and impact on the regional economy. The qualitative nature of the interviews will

allow for a more nuanced understanding of the issues, challenges, and opportunities associated

with the railway system.

Some sample questions for the interviews might include:

o How do you perceive the impact of the Lagos-Ibadan railway on economic activities in

Ibadan?

o What challenges have you encountered in integrating rail transport into the broader

transport network?

o What role do you see the railway playing in promoting industrial and agricultural growth

in Ibadan?

o What policy changes or investments are necessary to optimize the economic benefits of

the railway?

3. Focus Group Discussions

Focus group discussions will be organized with local community members and stakeholders who

are directly affected by rail transport in Ibadan. These discussions will explore the social and

environmental impacts of the railway, as well as the challenges faced by residents and

businesses in utilizing the rail system. A total of 4-5 focus group discussions will be conducted,

each comprising 8-10 participants. Focus group participants will be selected from different areas

of Ibadan, with particular attention to including marginalized and low-income groups who may

face different challenges in accessing rail services.

Key topics for discussion will include:

 o Accessibility and affordability of the Lagos-Ibadan railway for different socio-economic

groups

o Social and environmental concerns related to the railway, such as displacement or noise

pollution

o The impact of the railway on daily life and economic opportunities in the region

o Suggestions for improving the effectiveness of the rail system for local communities

4. Secondary Data Analysis

Secondary data will be collected from a variety of sources, including government reports on the

railway sector, statistics from the Nigerian Railway Corporation (NRC), publications from

international organizations (such as the World Bank and African Development Bank), and

academic literature on the economic impact of rail transport. This data will provide a historical

context for the study, offering insights into the evolution of the railway network in Nigeria and

its previous economic impacts. It will also serve as a benchmark for comparison with the current

state of rail transport in Ibadan.

Some of the key secondary data sources will include:

o Nigerian Railway Corporation (NRC) annual reports and statistics

o Government policy documents related to rail transport and regional development

o Academic research papers on the economic impact of rail transport in Africa

o Reports from international organizations on infrastructure development in Nigeria

Sampling Techniques
The study will use both purposive and random sampling techniques to select participants for the

surveys, interviews, and focus group discussions.

1. Surveys: A random sampling approach will be employed to ensure a representative sample of

business owners, transport operators, and residents from different socio-economic

backgrounds. The sample will be stratified based on the type of business (e.g., agriculture,

manufacturing, retail) and the socio-economic status of the respondents to ensure diversity in

perspectives.

2. Interviews: Purposive sampling will be used to select key informants who have a direct role in

the development, operation, or regulation of the Lagos-Ibadan railway. This includes

government officials, railway operators, business leaders, and transport experts.

3. Focus Groups: Participants will be selected using a combination of purposive and convenience

sampling methods, ensuring that the groups reflect a diverse range of experiences with the

railway, particularly with respect to its accessibility and impact on different communities.

Data Analysis Techniques

The data collected will be analyzed using both qualitative and quantitative methods.

1. Quantitative Analysis: Data from the surveys will be analyzed using statistical software (e.g.,

SPSS or Excel) to perform descriptive and inferential statistics. Descriptive statistics will

summarize the data on key variables such as transportation costs, trade volumes, employment

changes, and perceived impacts of rail transport. Inferential statistics, including chi-square tests

and regression analysis, will be used to examine relationships between variables and to assess

the significance of the findings.

2. Qualitative Analysis: The qualitative data from interviews and focus group discussions will be

analyzed using thematic analysis. This involves identifying and categorizing recurring themes,

patterns, and concepts in the data to provide a deeper understanding of the impacts and

challenges of the Lagos-Ibadan railway. NVivo or similar software will be used to facilitate the

coding process and to ensure a systematic analysis of qualitative data.