Nigeria needs to spend N3.1tr on infrastructure in 30 years

Nigeria will have to spend N1.3 trillion on transport infrastructure in 30 years, if it is willing to get out of economic quagmire, experts say.

At the Nigeria-Japan PP Conference for High-Quality Infrastructure held in Lagos, analysts said the country’s low infrastructure stock estimated at 20 to 25 percent of the Gross Domestic Product is stalling the growth of Africa’s largest economy, making diversification and job creation pipe dreams.

According to a the Infrastructure Concession Regulatory Commission (ICRC),  Africa’s biggest economy needs about N3.1 trillion to bridge the infrastructure gap in the transport sector in the next 30 years.

Mohammed Bamali, director of support services at ICRC, said 48 percent of the $3.1 trillion is expected to be provided by the private sector.

Nigeria has devoted only less than 20 percent of its annual budget on infrastructure and capital projects in the last decade. This has stalled productivity as major infrastructure such as power, railways, roads, water, among others, are lacking.

“One positive thing about infrastructure is that it determines the success of manufacturing and agricultural activities,” said Abimbola Onafowokan, chairman, construction and engineering group of the Lagos Chamber of Commerce and Industry (LCCI) at the conference.

“Good and quality infrastructure will help to bridge the gap in production and help eradicate poverty, but when this is not happening, there is an issue,” Onafowokan said.

Masaya Otsuka, deputy head of mission/counselor, Embassy of Japan in Nigeria, said infrastructure forms the basis for economic growth.

“As a basis of all economic activities, infrastructure delivers prosperity.  From the investors’ point of view, infrastructure is one of the major determinants. It will help attract investors,” Otsuka said.

Nike Akande, president, Lagos Chamber of Commerce and Industry (LCCI), told the Nigeria-Japan public-private sector conference that the $300 billion infrastructure deficit hinders economic growth and development, stressing that more needs to be done in the area of infrastructure financing.

Manufacturers and farmers incur high logistic costs on the back of poor road network, absence of railways, impure water, power fluctuations, and crude implements.

The country’s ports are among the most expensive in the world, despite that roads leading to them in  Apapa, Lagos, are bad.

In major industrial zones power outages occur six times each day, forcing local manufacturers to float an electricity company and resuscitate the independent power projects which they abandoned many years ago.

Most food, beverage, and chemicals companies in the country are spending a lot of money on water and its purification as Africa’s largest economy relies on boreholes and other water sources of unclean water.

Absence of railways means manufacturers and farmers use road, air and water transport which are costly and susceptible to theft.

Nigeria has fewer tractors than Serbia & Montenegro, (with 400,000), Pakistan (320,000) and Uzbekistan with (170,000).

According to Richard Hargrave, managing director, Dizengoff West Africa Nigeria Limited,  the countryhas only one tractor for every 4,100 farmers, stating that each tractor farms 1,013 hectares of arable land, which cannot guarantee food security.

 

ODINAKA ANUDU