Poor roads sink hope for Nigeria’s economic growth

Nigeria needs to overhaul its road infrastructure for the West African nation to reduce food prices, draw more tourist attention and drive inflows.

Good road network will potentially ward off lingering insecurity that’s threatening the economic growth of Africa’s most populous nation, data and interviews with sources familiar with the matter have shown.

While road transport stands as the major mode of conveying humans and goods in Nigeria, improved conditions of these roads would reduce delays, lower operational costs, extend vehicle lifespans, and stabilise transport pricing, reducing impacts on household incomes.

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“The deteriorating condition of Nigeria’s roads has become a significant strain on the economy, costing billions of naira annually in lost productivity and resources,” a recent report by Lagos-based research and data insight firm SBM Intel stated.

It however added that beyond the economic setbacks occasioned by the poor road network, it has equally claimed countless lives in preventable accidents.

This is despite substantial yearly budgets dedicated to road construction and maintenance, the country continues to face a persistent gap in the quality and quantity of its road infrastructure.

Nigeria boasts the largest road network in West Africa, spanning 108,000 kilometres of paved roads but have been washed away by flooding with many of the roads now filled with potholes.

Bad roads lead to higher fuel consumption, translating to high transport costs, according to Bunmi Bailey, head of research at SBM.

“Over the past couple of years, the road network in Nigeria has actually been very poor. The impact affects the economy and is already affecting the transportation sector.”

“Poor road network also affects connectivity of trade and commerce,” Bailey added.

A recent survey by SBM revealed that actual travel times on Nigerian roads are significantly longer than estimated, with delays caused by traffic congestion, insecurity, and poor road infrastructure – leaving nearly 70 percent of respondents rating road conditions as average or poor.

Motorable roads may partly slow food prices

Nigeria is currently contending with high food inflation that has climbed to 39.84 percent in December 2024 with yam, rice and maize grains driving prices up.

But analysts have said good road networks may cut down input costs farmers add to the produce they sell, relatively allowing for food prices to cool while encouraging more cultivation.

“The ease at which these goods are moved from let’s say the North down to Lagos is very difficult and most times these farmers factor in ease of moving into their input cost. If there’s a way that these goods can easily be moved from one location to another, even the final cost of these goods will be very cheap,” said Tobi Ehinmosan, macroeconomic research analyst at FBNQuest.

Apart from beating down prices, a good road network will slow down waste accumulated in transit as perishable goods will reach their destination quicker, avoiding loss of scarce resources.

Good road network attracts tourists, bring in dollar inflows

Nigeria is one of the most sought after tourist destinations evidenced by the just concluded Detty December, an event that brought in dollar inflows and contributed at least four percent to the country’s gross domestic product.

Analysts believe that improved road conditions can significantly help position the country as a desired destination for tourism, facilitating diaspora remittances and growing the economy.

“A good road network is an infrastructural drive. People would be more encouraged to come to Nigeria, making the country a first choice for tourists. More tourist interest in the state obviously means more inflows,” Ehinmosan, quoted earlier, said.

Poor road network allows for insecurity

Nigeria’s worsening insecurity is exacerbated by poor road conditions, endangering commuters’ lives, reducing economic activities on identified hotspots and slowing agricultural productivity, especially at the food-growing parts of the country.

In its survey, SBM stated that 84.6 percent of the respondents reported experiencing or hearing security incidents along their travel routes.

This stark majority underscores the frequent occurrence of such incidents, leaving only 15.4 percent of respondents who had not encountered or heard of any.

“The survey further highlighted the existence of dangerous hotspots across Nigeria’s major cities and highways, pinpointing areas with particularly high risks of theft, attacks, and road hazards.

“Dangerous hotspots were identified in key urban centres like Lagos, Port Harcourt, and Maiduguri, all critical for interstate travel. These cities, known for heavy traffic, saw elevated insecurity, especially during peak travel hours in the evening, when commuters are most vulnerable,” it said.

Bad roads shrink transport contribution to GDP

Over the years the contribution of the transportation sector to the country’s GDP has shrunk from the highs of 17.1 percent in 2021 to a staggering 2.5 percent last year.

This drop has been attributed to poor road infrastructure and high petrol price as a result of subsidy removal which slowed the demand for transportation services.

Nigeria must then put the right infrastructure in place, according to Bailey, to fix the transportation sector in order to achieve the $1 trillion economy target by 2030.