The federal government has planned to earn a minimum of N6 billion from the concessioning of 20 silos under consideration.
Audu Ogbeh, minister of agriculture and rural development speaking at the handing over ceremony of the silos to the concessionaires, in abuja, stating that the government established silos complexes and commodity warehouses in various parts of the country aims at promoting products storage and stabilize commodity prices to industries.
He said “The federal government embarked on the construction of first set of metal silo complexes consisting of the five silos at Akure, Gombe, Ogoja, Minna and Makurdi. Government established silos complexes and commodity warehouses in various parts of the country to aid the storage of products, stabilize commodity prices and supply commodities to industries”.
He explained that the concession is mainly for the purpose of ensuring effective and efficient operation and maximum utilization of the silos adding that the Federal executive council has approved 20 of the 33 silos complexes to be concessioned after successful negotiation with the preferred bidders.
The minister added that of all the silos, the federal government will retain 6 silos for price stability, strategic reserve and to guarantee minimum price scheme. The concessionaires include; Matrixville consortium, flour mill limited, coscharis farms limited, agro universal consortium, Ebony agro industries limited, and Neon farms Africa amongst others.
“The transaction process to concession the silo complexes was initiated in August 2013 by the ministry, while the infrastructure concession regulatory commission (ICRC) statutorily oversees the process with the world Bank support through the ministry of finance”.
“The concession term is for a period of 10 years, during which the concessionaires will operate and maintain the silo complexes under the supervision of the ministry and ICRC. The concessionaires will compensate the government through a fee structure broken down into three components”, he added.
Chidi Izuwah, Director General, Infrastructure Concession Regulatory commission (ICRC), in his remark said that the continuous investment in infrastructure is essential for the national growth, adding that infrastructure development often attracts private sector investment.
“These assets had been kept useless will now create financial value and aid transformation of our nation as we are out to ensure that the government reap the full benefit of any public private partnership agreement”.
“The government will get back this value through three component fund, which include; an upfront one-off payment of N1.3 billion, an annual fixed value of N3.4billion and an annual share of profit from operations valued at N6 billion”, he added.
Mohammed Bello Umar, permanent secretary, ministry of agriculture stressed that the concession of the silo is a step in the right direction as it will generate revenue for the government, adding that effective management of the silos will create wealth, employment and stimulate agricultural production.
He said ” I will encourage private sector investment which will result in optimum and beneficial use of the silo facilities to create wealth for the operators, generate employment and stimulate agricultural production in Nigeria”.
Umar, speaking further said that the ministry will encourage the concessionaires to succeed and will take full responsibility for the oversight functions to ensure that the silos are used for the purpose they are meant for.
” This program is geared towards creating an increased private sector participation in agriculture and attract investments into the agricultural sector”.
Widor Ferati, Matrixville consortium, on behalf of the concessionaires commended the government adding that each concessionaire will give in their best to ensure that the silos live up to expectation.
“Investing in agriculture is key to ensuring economic development and poverty reduction in any country. With this concession today, we hope to impact all players in the agricultural value chain”, he said.
Cynthia Egboboh, Abuja
