• Tuesday, April 23, 2024
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AFDB: Nigeria infrastructural needs estimated to reach $3 trillion by 2044

Nigeria’ s infrastructure cumulative financing needs are estimated to reach $3 trillion by 2044 and about $100 billion annually, according to the Africa Development Bank (AfDB).

Ebrima Faal, Senior director, Nigeria country department who announced this at the Africa Investment forum held Tuesday in Abuja also estimated Africa’s annual infrastructure financing gap at between $130 and $107 billion annually and this is despite impressive growth rates in most of the continent.

Faal noted that traditionally, infrastructure development has mainly been the domain of the public sector depending largely on the generosity of donors, but that it has become increasingly clear over the last 50 years, but particularly following the 2008 financial crisis; that Governments are unable to meet the growing demand for
infrastructure and services alone.

“As a result, large fiscal deficits arising from imprudent fiscal management policies, have led to decreasing public expenditure on infrastructure. This has widened even further the infrastructure financing gap and preventing the construction of much needed transformative infrastructure in the continent.

He said adding to this is the fact that Overseas Development Assistance has also been unpredictable, encumbered, and decreasing.

“Whereas in the past, ODA accounted for about $6 billion or 15 % of the financing of infrastructure, this amount has been declining and has become more unpredictable.”

He explained that there is therefore need for change of funding mix and create partnership to finance infrastructure and other projects inAfrica, stressing that overseas development assistance which in the
past accounted for about %15 of the financing of infrastructure has been unpredictable, encumbered and decreasing over the years.

He said “with the increasing demand in infrastructure projects, there is need for greater and closer collaboration; long term partnership between the bank and supply chain to harness collective capacitiesthat meet the size and pace of demand”.

“There have never been a better time to invest in Africa infrastructure asset as business in Africa is now strengthened by factors which are now converging to mitigate risk and drive high
returns on investment and economic prosperity”, he added.

Stella Kilonzo, senior director, Africa investment forum said that the forum is aimed at identifying bankable projects, raising capital and creating opportunity to promote businesses in Africa.

“Businesses in Africa is growing rapidly but there is need for us to identify the critical projects that will transform and lead to further growth of the economy, we are using credit enhancement tools to
promote private and public sector co-investments,” she said.

Kilonzo speaking further said that the forum will ensure creation of policy that ensures successful execution of identified projects, ensure de-risking and effective guarantee instruments for each project. “We are focusing on projects worth minimum of $30 million in Energy sector, agriculture, healthcare and all projects that will
transcend countries”.

Folarin Ayalande, Special Advisor to the president-coordinator ERGP Unit, said that the Africa investment forum is private sector driven and will be focused in identifying projects with potential to creating jobs and affecting the lives of the general public.

He said “Investment in Nigeria has been hindered by number if constraints in power, transportation, infrastructure, with the ERGP, the Nigeria government is targeting development in these sectors to
build a sustainable economic growth and create a conducive environment
that will attract private sector investments”.

 

Cynthia Egboboh, Abuja.