APM Terminal canvasses tax laws to attract investors to port infrastructure
The Chief Financial Officer of APM Terminal Nigeria, Courage Obadagbonyi, has said Nigeria has to find creative ways to unleash private sector participation in port rehabilitation and development instead of depending on government funding through borrowing.
According to him, the latest data published by the Debt Management Office (DMO), which puts the country’s debt profile currently at N42 trillion – about four times the country’s total revenue budget yearly, makes the cost of borrowing more expensive.
Speaking as a panelist during a session on ‘Financing Maritime Assets – Ports and Shipyards’ at the just concluded Nigeria International Maritime Summit (NIMS) 2022 in Lagos, Obadagbonyi said funding viable infrastructural projects was not an issue in terms of availability of cash, as there are lots of private equity and multilateral funding available if the projects are well positioned and investors have line of sight to their payback.
Obadagbonyi said with more publicity and engagement with private stakeholders, some of the challenges bedeviling investing in port infrastructure can be fixed, adding that there are incentives available to investors in Nigeria.
According to him, Nigeria has tax laws that incentivise investment, such as pioneer legislation, infrastructure and roads tax credit programme, which companies like MTN and Dangote have used to successfully build hundreds of kilometres of roads and bridges across the country.
He said these tax laws can also be replicated in the ports system with great capital allowance provisions that encourage investors and attract private capital to the nation’s seaports.
Obadagbonyi stated that APM Terminals has invested more than $438 million in the Lagos Port Complex for developing infrastructure, acquiring equipment and improving processes at the terminal.
He said the terminal has also been in the forefront of digitisation of port operations in Nigeria, in line with its commitment of introducing new innovations to help both shipping lines and landside customers achieve improved supply chain efficiency and flexibility in a cost-effective manner.
Also, the Minister of Transportation, Mu’azu Sambo, agreed that sustainable financing models are important to building critical maritime assets such as shipyards and ports across the country, while declaring the summit open.