Very soon, Nigeria would be returning to the bond market to raise a fresh N300 billion through its upcoming Series VII Sukuk, a Sharia-compliant financial instrument aimed at attracting ethical investors.

Between 2017 and December 2023, the government raised over N1.09 trillion from six series of Sukuk, and this was invested in the construction or rehabilitation of roads across the country.

So far, according to the Director General of the Debt Management Office (DMO), Ms. Patience Oniha, over 4,100 kilometres of roads and nine bridges across the six geopolitical zones and the Federal Capital Territory have been either constructed or rehabilitated.

Among those included are the dualisation of the Lokoja-Abuja-Benin, Abaji-Lokoja, Kano-Maiduguri; Oyo-Ogbomosho and Benin-Shagamu roads, and the rehabilitation of the Enugu-Onitsha and Enugu-Port Harcourt roads, among others.

However, a trip through many Nigerian highways, especially those in the southern part of the country, shows that the roads are merely highways to hell.

The state of Nigerian roads is pathetic, poorly maintained, and riddled with potholes, leading to accidents and fatalities. In fact, Nigeria is said to have one of the highest road accident rates globally, with over 41,306 road deaths annually.

The government has struggled to finance the country’s road infrastructure deficit, estimated to be around N18 trillion. The World Bank estimates that Nigeria needs \$3 trillion over 30 years to reverse the decline in road infrastructure in the country.

Besides budgetary allocations, which are grossly inadequate—for instance, in 2025, the budgetary allocation for road construction and maintenance was a little over N1 trillion—there is also the question of effective utilisation of available resources.

It is no secret that the cost of either constructing or maintaining a kilometre of road in Nigeria is extremely high when compared to other African countries.

A report by the Centre for Social Justice (CSJ), based on an earlier study by the World Bank, estimates the cost of constructing a kilometre of road at between N400 million and N1 billion.

In 2013, the Federal Government awarded a contract for the reconstruction of the 127-kilometre Lagos-Ibadan Expressway at N167 billion, which was equivalent to $1 billion at the time in terms of the naira exchange rate to the dollar.

In the same year, a similar contract was awarded for the 1,028-kilometre Lagos-Abidjan road project. The Economic Community of West African States (ECOWAS), which awarded the contract, estimated this project to cost between N167 billion and N240 billion.

The six-lane ECOWAS project is expected to connect five major cities in the region, namely Lagos, Nigeria; Cotonou, Benin Republic; Lome, Togo; Accra, Ghana; and Abidjan, Côte d’Ivoire. In other words, the number of kilometres to be covered by that project is eight times higher than Nigeria’s Lagos-Ibadan Expressway project, and the cost per kilometre is far lower than that of Nigeria.

At N240 billion projected maximum cost, the cost of the ECOWAS road project per kilometre is N234 million, while the six-lane Lagos-Ibadan Expressway contract awarded by the Federal Government at N167 billion costs N1.3 billion per kilometre.

Analysts believe that the utilization of the N1.1 trillion raised through Sukuk bonds for road infrastructure in Nigeria, though showing significant progress—especially the construction of 4,100 kilometers of roads and nine bridges—they said, considering the existing deficit of 140,000 kilometers of bad roads, it raises questions about the overall effectiveness and efficient utilisation of the allocated funds.

Professor Godwin Oyedokun of Lead City University, Ibadan, said that to assess whether the funds have been judiciously utilised, there’s a need to analyse the cost per kilometre for the roads constructed compared to similar projects in other regions.

The professor of Accounting and Financial Development noted that the government should always be transparent by establishing clear criteria and benchmarks for project selection and execution, adding that regular audits and public reporting will enhance transparency.

“I expect that government should always focus on projects that have the greatest impact on economic growth and accessibility, particularly in underserved regions,” he said.

He suggests that for future Sukuk bond issuance, the DMO should implement a robust system for tracking the progress and impact of projects funded by Sukuk proceeds.

“By focusing on these areas, Nigeria can enhance the effectiveness of the upcoming N300 billion Sukuk issuance and make more significant strides in addressing its road infrastructure deficit,” he said.

On his part, Lead Director, Centre for Social Justice (CSJ), Eze Onyekpere, said the debt management system lacks transparency, while the budget and procurement system in the country is bereft of value for money.

He said, “How much does it cost to construct a kilometre of road on clay or any type of prevalent soil in Nigeria? Over 50 per cent of borrowed resources are stolen, and there is no means of tracking the investment of borrowed funds as of today.”

He called for a total reform of the Nigerian debt management system while overhauling the procurement process to guarantee that the letter and spirit of the law are in tandem with implementation realities.