By Olamilekan Alani
Yemi Osinbajo, the Vice-President of Nigeria says in order to fix the infrastructural deficit confronting the country, $2.3trn will be needed in the next 30 years.
Osinbajo disclosed this on Thursday through his Senior Special Assistant on Media and Publicity, Laolu Akande, at the opening of a two-day retreat at the National Council on Privatisation to deliberate on the proposed amendment of the Public Enterprises (Privatisation and Commercialisation) Act 1999.
He said since government’s resources were completely insufficient, the only way to bridge the gap was by Public-Private Partnership arrangement in one form or the other.
The statement was titled, ‘How to access local, global funds to develop Nigeria’s infrastructure, by Osinbajo’.
According to the statement, Osinbajo cited statistics from Nigerian Integrated Infrastructure Masterplan and the Economic Recovery and Growth Plan 2017-2020 to buttress his point.
He was quoted as saying, “Nigeria will require at least $2.3 trillion over the next 30 years to bridge this gap.
“The review of budgetary allocation for capital expenditure even over the past decade will show that government resources are completely insufficient for this purpose.”
Osinbajo added that while government can take either commercial or concessionary loans for infrastructure development, that will be an additional burden on a usually considerably leveraged balance sheet.
He added, “There is a large pool of investable funds from both local and international investors for the development and maintenance of infrastructure.
“But these are only accessible where there is a business case to be made for developing public infrastructure.
“So, for both institutional and individual investors, there is far more comfort with lending or with equity participation where a private sector entity partners with a public authority owner of the infrastructure.
“This way the public partner can play its natural role of a regulator (regulation and policy), leaving business to the private sector whose reason for being is business. So, for investors, PPP presents the best of both worlds.”
While urging participants drawn from the private and public sectors at the retreat to remain focused on the objectives of the meeting, the Vice President was further reported to have emphasised that developing a framework that will be attractive to investors should be topmost in their deliberations.
Earlier in his opening remarks, the Director-General of BPE, Mr Alex Okoh, said the current economic environment requires government to adopt innovative ways of attracting resources for infrastructure development.
He said an amendment of the BPE Act would among other things expand private sector participation in the Nigerian economy as well as attract more foreign capital to different sectors of the economy.
