Four years and over N40billion later, the second River Niger bridge is only at the preparatory stage for a construction that is supposed to span five years, it’s moving at a pace that will make a snail beats its chest in pride, writes ISAAC ANYAOGU, who visited the project sites.
At first glance it looks busier than a hive, young men with callused muscles working heavy duty machines, others mixing cement and sand, some fabricating metals, others welding iron rods emitting the careless spark of radiation, all the regular bedlam associated with a construction site but something still doesn’t seem to add up.
Workers at the Onitsha end of the bridge
You examine the project sites thoroughly and you think that perhaps there should be more people, but then you have been told that there are already 300 workers hired for the project, you stare at the heavy duty machines like there should be more, both in numbers and sophistry, after all, this is going to the longest bridge on the African continent, measuring 44kilometres, tax payers have already been inflicted a bill of over N44billion, and the buzz on the airwaves has reached fever pitch.
Raising a column, part of early works IV, Second River Niger Bridge, Onitsha end
This is the recurring feeling around the project sites of the Second River Niger Bridge in Onitsha and Asaba – a work in progress, barely. There were about two dozen workers on Wednesday March 7 when I secured access to the project site after being told by stern-looking mobile police men and security personnel of Julius Berger that taking pictures was prohibited. An inability to secure protective gear and quicker access only meant that the visit to the project sites had to be undertakenwhen workers were already on break.
But the project has always had a chequered past right from when the idea was first muted in the 1976. It was conceived to serve as a land gateway into South eastern Nigeria as the current one is overburdened and creaking from effects of age and overuse. The first Niger Bridge was built in 1966 and it always been clogged with mind-numbing traffic.
The bright idea to build an alternative that will even connect the South south region sounded enticing at a time the country was awash with petrodollars. However for many years, little more than talk was done as successive administrations did not rank the region as priority until 2014, when Julius Berger was named the preferred bidder of the Engineering Procurement and Construction contract on the Second River Niger Bridge during the administration of former president Goodluck Jonathan. JB-NSIA formed Public Private Partnerhsip arrangement to actualise the project in 48 months.
But the fortunes of the project did not change dramatically. True, Jonathan performed the ground-breaking ceremony of the bridge at the Krisoral ground, Atani, Ogbaru council area of Anambra state in March 2014, when he was voted out of office in May the next year,little has been done beyond a campaign gimmick.
In January 2015, on his way to a PDP campaign in Onitsha, Anambra, Jonathan stopped over at the Asaba project site and said the Federal Government has spent N10 billion on construction of the 2nd Niger Bridge out of the N130 billion total cost of the project.He did not stay in office long enough to complete it.
Muhammadu Buhari was sworn on May 29 and the music changed. The Infrastructure Concession Regulatory Commission (ICRC) said the construction of the bridge cannot proceed saying the cost was off the mark and planned toll fees to be charged under the PPP, and the Design Build Finance Operate Transfer (DBFOT) model would be reviewed. Other issues included compensation to be paid to the host communities along the proposed bridge.
But this was partly in response to allegations by Adams Oshiomole, former governor of Edo state that over $700million had been withdrawn from the Sovereign Wealth Fund (SWF) by the Jonathan government and spent on consultancy services for the project. The Nigeria Sovereign Investment Agency (NSIA) clarified that only $2.21 million, representing less than 10 per cent of the project cost, had been paid as consultancy fee.
Mike Onolememen, former Minister of Works,further debunked the allegation claiming that the total project cost was N108 billion (excluding Duties and Value Added Tax), arrived at, after BPP’S review of the Concessionaire’s submitted cost of N138 billion.
The former minister also said that the Federal Government of Nigeria (FGN), guided by the Transaction Adviser, Roughton International, agreed to provide a refundable Catalytic Funding of N30 Billion. By May 2015, N10 billion Catalytic Funding was paid from the Federal Ministry of Works’ SURE-P Budget to fast track the early and sub-structural works of the bridge.
Like 2014, like 2018
My visit to the project sites and series of interviews with residents and business owners in the community gave the impression that it is 2014 all over again. When it became certain that he had squandered the goodwill of Nigerians, Goodluck Jonathan flew the kite of a second Niger Bridge and the airwaves were awash with pictures of activities around the project sites. While it helped him garner bloc votes in the South east, it was not enough to win a second term.
Site preparations to raise a column, Second Niger Bridge, Onitsha
Similar scene seems to be playing out as there is lingering suspicion that the project is an attempt to score South East votes, in the forth-coming 2019 general elections. The region is perceived to be marginalised by the current administration in terms of representation and project execution and as the election cycle nears, the Second Niger Bridge project was resurrected.
Asaba end of the Second Niger Bridge (completed early works)
“I think it is because of elections they are rushing the project now, why have they abandoned it all these years?” queried a native of the community who identified herself as simply Blessing.
Many spoke along the same vein on the condition of anonymity. Unlike many other projects in these regions, the construction of the second River Niger Bridge has gone on without communal unrest. Many confirmed that Julius Berger had treated them fairly. Inquiries revealed that the company had developed a data base using applications sent by those who are from the community. If there is a vacancy, they get a call, medicals are conducted and they start working on the project. Community people, I learnt were less likely to destroy something they are part of the construction process.
“If you are looking for work, just go to the yard (Onitsha) and submit your application, if you are from this community, they will take you,” said Okorafor Chuka, a commercial motorcycle operator, plying the project area, whom I had approached while posing as a job applicant to get access to the project site.
So far Early works (a term used to describe the start of a construction phase) I, II, III have been completed at the Asaba end and the fourth one is on-going at the Onitsha end. Each of the construction phases cost at least N10billion according to sources with knowledge about the project and the fourth phase is valued at N14billion. This puts the total value of the funds spent on the project to about N44billion. Yet the Federal Government is yet to sign a Memorandum of Understanding with Julius Berger on the project.
“Without an MoU, we cannot really commence critical aspects of the assignment because of the complexity and the huge capital outlay required,” a source in Julius Berger confided in BDSUNDAY.
Early work in progress, early works (Asaba end)
Releases disbursements for the projects have been documented in media reports.During a House of Representatives Committee on Works hearing organised for Babatunde Fashola, minister of Power, Works and Housing in January, speak of the house of representatives, Yakubu Dogara said: “The Nigerian Sovereign Investment Authority had spent about N18 billion on the Second Nigeria Bridge as the financier during their early stages.”
Meanwhile, Osinbajo, during the APC governorship campaign in Onitsha, Anambra State, on October 20, 2017, said the Federal Government paid the contractor Julius Berger N2billion released from the Sovereign Wealth Fund managed by the NSIA. N5.05billion has been provided for the project in the 2018 budget.
“Past administrations have celebrated progress ostensibly made on them (construction projects) while achieving little or nothing in reality,” said Dogara. “They have become media sensations and highly politicized to the extent that it now seems that we are playing games with the lives of our people.”
Julius Berger staff at work, Asaba, Delta State
But it doesn’t seem much has changed though. Budgeting N5.05billion a year for a project initially valued at over N106billion, over the course of 48 months, is the best measure of frivolity.
“Various factors have been identified in this regard, including the sheer complexity of some of the projects and the desire of some of the investors to have some of the projects gold plated by the government,” said analysts at Olaniwun Ajayi.
A new approach
At the investigative hearing called by lawmakers in January, Fashola expressed hope that a national consensus can be generated on Public-Private Partnerships for infrastructure development.
It is critical now. According to the African Development Bank (AfDB), Nigeria’s core stock of infrastructure is estimated at only 20-25 per cent of GDP, compared with 70 per cent for other middle income countries of its size, leaving an infrastructure deficit of $300bn.
A recent report by the Africa Finance Corporation (AFC), a pan-African multilateral development finance institution, and the Boston Consulting Group, a global management consulting firm, says private investments in infrastructure is the new normal for big ticket projects like the Second Niger Bridge.
For governments with shoestring infrastructure budgets, the report says, they need to clarify regulation, develop fiscal incentives, and facilitate provisions that promote dispute settlement and licensing.
Nigeria like many countries in Sub-Saharan Africa is on the cusp of growth, navigating a tricky bend where growing populations, economic growth, and rapid urbanisation, is creating an ever-increasing need for infrastructure planning and development. In this era, elephant projects to score political advantages will no longer suffice.
Due to their shoestring budgets, the Federal Government can no longer solely depend on budgetary allocations to fund infrastructure on the scale required to grow the economy. According to National Bureau of Statistics (NBS), over the last decade, Nigeria’s infrastructure spending contributed a 1.9 percent (approximately $4 billion) per annum to GDP.
“Current estimates based on OECD data and BCG analysis indicate that the world needs around $4 trillion in infrastructure investment per year. But currently annual total spending amounts is only around $3 trillion (public sector finances two-thirds), with $1 trillion of that amount invested in Asia,” says the report.
Of the $50 trillion needed globally for infrastructure through 2030, around 80percent is needed for core infrastructure: 47percent (around $23.5 trillion) for transport infrastructure, including roads, rail, ports, and airports; 25percent (around $12.5 trillion) in power projects; and 10percent (around $5.0 trillion) in water projects.
The report titled ‘Infrastructure financing in Sub-Saharan Africa, best practices from ten years in the field,’ draws on the experience and best-practice advice of experts from both the private sector and the public sector found that private infrastructure investment is on the rise globally, but Sub-Saharan Africa visibly lags behind such investment elsewhere.
In a quarter of a century, Sub-Saharan Africa has only $77 billion in PPP projects, compared to $124 billion in Turkey alone, or $658 billion in South America (with Brazil alone representing $433 billion). These numbers highlight Africa’s enormous potential for growth going forward.
Even though successful projects are likely to generate a higher return on investment in the region than similar projects in other regions, investors face tough challenges related to government and financial markets.
Complications that can arise include limited public-sector capabilitiesto develop strategic foresight and planning, insufficient political will,policy uncertainty, weak regulatory environments and law enforcement,and a shortage of people who have the needed technical skills.
Financial markets too are often narrow with higher actual and provisional risks, longer project durations, significant cost overruns,and currency mismatches which make financing issues more complex.
In addition, Africa often fails to attract first-tier international privateinvestors in infrastructure projects, and a number of the second- andthird-tier investors that tend to be more active in the continent lack somecapabilities themselves.
Most African countries’ regulatory frameworks remain limited, piecemeal, and untested. This can improved by seeking to understand and nurture the idea that increased private investor
involvement in the infrastructure space is the best way to achieve intensive jobs creation and to incentivize funding and skill transfer. African governments are attempting to address these deficiencies.
“Governments in the region need to clarify regulation, develop fiscal incentives, and facilitate provisions that promote dispute settlement and licensing. This is because increased private investor involvement in the infrastructure space is the best way to achieve intensive job creation and incentivize funding and skill transfer,” says the report.
The report also called for the establishment of a solid legal and regulatory framework, and guarantee its enforcement and stability both within the relevant sector and more generally. Within the sector, governments should clarify specific standards and relative laws and more generally, they should clarify and develop fiscal incentives, and facilitate provisions that promote dispute settlement and licensing. The builders of the second Niger Bridge can well benefit from this counsel.
