Nigeria needs N36tr yearly to close infrastructure gap
For Nigeria to meet its huge infrastructure, the nation needs about N36 trillion yearly for the next 30 years.
A new report on Nigeria’s Economic Outlook 2022 published by Proshare Economy, identifies the necessary investment in the infrastructure company (Infraco); electricity value chain; aviation; seaports, and insecurity.
The report said with a seed capital of N1 trillion jointly contributed by the Central Bank of Nigeria (CBN), the Nigeria Sovereign Investment Authority (NSIA), and the African Development Bank (AfDB), the Infrastructure Company (Infraco) is expected to bring about private sector involvement to improve Nigeria’s infrastructure. The N15tr Infraco set up to bridge the nation’s infrastructure gap became operational in the third quarter of 2021.
Also, the report stated that the 24-hour Nigerian International Financial Centre (NIFC) is expected to act as an international gateway for capital and investment, adding that the NIFC would offer high-return-yielding investment opportunities in Nigeria to the world.
The report quoted the World Bank, as saying the country needs N36 trillion yearly to close its infrastructure gap for the next 30 years.
In the electricity value chain, it stated that only 22 per cent of the poorest households have access to electricity, while 82 per cent of the richest can access power.
It stated: “The US$2.3bn Presidential Power Initiative (formerly the Nigerian Electrification Roadmap) which was launched in July 2019, was meant to see German company, Siemens AG, provide 25,000 megawatts (MW).
“However, two years after, the first phase of the project which should have brought the electricity grid to 7,000MW by the end of 2021 has yet to kick in. Nigeria’s electricity value chain is characterized by a power generation transmission mismatch. Despite the country’s more than 8,000MW of operational power-producing capacity, only an average of 4,500MW is received by end-users.
“World Bank stated in a recent report that Africa’s largest economy had the largest number of people without access to electricity in the world and that electricity subsidy benefited mainly richer households.”
However, it noted that the aviation sector roadmap of the Federal Government is expected to see the four major commercial airports – Lagos, Port-Harcourt, Abuja, and Kano Airports operate more efficiently and profitably through a concession arrangement.
“The concession programme request for qualification stage (RFQ) was completed in October, while the Request for Proposal (RFP) is expected before the end of the year. The concession programme is expected to upgrade airport facilities bringing them to the level of international aviation hubs,” it stated.
At the seaports, it stated that cargo clearing logistics have continued to constitute a significant impediment to the conduct of business in Nigeria.
Despite the introduction of the e-call up system (Eto) – which was meant to reduce the congestion along the port corridor by scheduling the movement of trucks, it stated that port operators complain that the process is being sabotaged. The report also detailed the adverse effect of insecurity on the Nigerian economy, with the advent of bandits and kidnappers posing a major threat to the livelihood of farmers in the North-West region.
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