Nigeria needs $800bn for 10yrs to fix infrastructure deficit

By Motolani Oseni

Despite huge investments by the federal government of Nigeria in different sectors of the economy, the nation still needs a whopping $80 billion financial commitment annually for 10 years to fix its infrastructure deficit.

Experts stated this yesterday, at the national workshop of the Association of Business Editors in Nigeria (ABEN), themed: ‘Infrastructure Financing as Pathway to Sustainable Economic Development,’ charged the government to partner with the private sector to fix infrastructure deficit in aiding business growth and economic development.

Speaking on the theme, the former acting Managing Director/CEO, Bank of Industry (BoI), Dr Waheed Olagunju, explained that, there cannot be meaningful development without investment in infrastructure, adding that, infrastructure catalyses other development.

According to him, “the country needs $80billion every year for the next 10 years. To address this, the government must partner private sector which will provide funding for infrastructure projects.”

Olagunju, who was also the chairman of the occasion, said, realising how critical infrastructure such as road and rail transportation as well as maritime and aviation sectors are, the federal government, through the National Development Plan (2021-2025) expected the transportation industry to generate 15 per cent, amounting to N52trillion of the over N300 trillion revenue target, into the economy, even as the government expects 85 per cent of resources to come from the private sector through a Public Private Partnership(PPP).

While preaching for inclusive growth and sustainable development, he said, good ratings are critical to make Nigeria an investment hub, urging the government to have an internationally acceptable standard and structure that financiers would be interested in, to fund developmental projects in the country.

“Nigeria must be an investment hub for investors. Let’s continue to market Nigeria as an investment destination, and ignore negative reporting that is negatively affecting the ratings of Nigeria as a country. Rule of law must be right to build confidence in the system. Our laws and constitution should not be cumbersome, should be adaptive, and avoid too much bureaucracy that could distract investments. Infrastructure takes longer time between 20 to 30 years, hence, structures must be built around continuity of infrastructural projects irrespective of who is in government,” he pointed out.

Similarly, the commissioner for Economic Planning and Budget, Mr

Sam Egube, stressed that there is the need to raise capital from all sources to fix infrastructure, but doing this, will ensure that the fiscal financing structure meets international standards, such that, the private sector can finance projects without exhibiting any fear of losing their money.

Egbe, who delivered the keynote address at the event, stated that Lagos State has tried this model, and its working, adding that, a lot of capital projects ongoing in the state have more private sector funding input which speaks to the quality of structures the state government has, to attract financiers for its projects.

According to him, to get funding from the private sector both local and international, for your infrastructure projects, your ratings must be right. Pension funds is also another alternative to finance infrastructure development but you must get your structure right to drive the needed funding.

“Infrastructure is huge, so, it’s beyond the federal government alone, states and local governments must equally play their parts while the private sector provides the funding”, he said.

If infrastructure is fixed, he said, other development follows, as infrastructure is the life wire of growth and development.

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“The Lekki deep seaport is three times bigger than Apapa port and what that does is to improve turn-around time, attracts Investment and business opportunities to the Lekki axis and this is how development works. The rail system is targeted at transporting 32million people monthly. The 4th mainland bridge project will soon be awarded by December. We target to lay 6,000km of fibre cable across the state, the first phase of 3,000km is almost concluded and what that does is increase internet connectivity and reduce the cost of data, DailyTimesNGR gathered.

“With that, it creates additional business opportunities for people. All these infrastructure projects will connect to create a conducive business operating environment and better living conditions for Lagosians. This is how the economy develops. However, the private sector is key in all these projects, hence, the government must embrace PPP arrangements to address the infrastructure deficit in the country. ” he said.

Earlier, the chairman of ABEN, Mr Omoh Gabriel , had said, the level of infrastructure deficit in the country is a cause for concern, calling for more discussions around this critical problem.

He noted that every developed economy invested heavily in infrastructure, adding that, Nigeria’s case should not be an exemption.

To this end, he called for strong collaboration between the public and private sectors to fix this challenge.

Also, the managing director, of Sundry Foods Limited, Ebele Onunwa, who was represented by the company’s regional manager, Jubril Shoaga, called on the government to address multiple taxations that are impeding Small and Medium Enterprises(SMEs) across the country.

At the event, there were Goodwill Messages from the Dangote Group, United Bank for Africa (UBA), and Access Corporation, among other sponsors of the annual conference.