Appraising the politics of Buhari’s infrastructure development, by Lewis Chukwuma
Lewis Chukwuma
Nigeria is Africa’s largest economy. She will need to spend at least a princely $3 trillion over 30-years to close its nightmarish infrastructure deficit.
This is not mere tattle-tale but a researched fact from Moody’s Investors Service, released last November.
This circumspect and very objective projection would probably have swamped most national leaders. President Muhammadu Buhari is not one such leader.
Some may ask why is infrastructure development so critical? It’s hardly disputable that infrastructure transformation is crucially important to foster countries’ economic development and prosperity.
Investments in infrastructure contribute to higher productivity and growth; facilitate trade and connectivity and promote economic inclusion. Globally, infrastructure demand is high for obvious reasons.
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These facts can not be over-stressed. Focused infrastructure development is important for faster economic growth and alleviation of poverty in the country.
Adequate infrastructure in the form of road and railway transport systems, seaports, power, airports and their efficient working, is also needed for integration of the Nigerian economy with other economies of the region, continent and world at large.
The economy needs reliable infrastructure to connect supply chains and efficiently move goods and services across borders.
Infrastructure connects households across metropolitan areas to higher quality opportunities for employment, healthcare and education.
Since 2015, the Buhari presidency has done more than its predecessors in rehabilitating federal roads notwithstanding other competing infrastructure funding imperatives.
For an administration committed to funding numerous other critical national infrastructure projects aimed at economic self-reliance and increased domestic output, it is indeed commendable how the Buhari Administration devised economically sound fiscal strategies to fund the redevelopment of various Federal Highways, including those nearing completion.
It could be recalled that the World Economic Forum’s 2019 Global Competitiveness Index ranked Nigeria 116 out of 141 countries, largely due to the poor state of its infrastructure.
The situation is dire in most cities but worse in rural areas where more than half of Nigeria’s population resides.
All these positions expressed by respected international research platforms may have hardened the resolve of Buhari to take a different path and change the old infrastructure story of the nation.
Going forward, a more specific focus on the grounds the Buhari administration has covered would show that genuine attention to specific infrastructure challenges produces a tangible, measurable result. Take roads for example.
A quality road network being the most critical component of a national multimodal transportation plan is the foundation of a thriving economy.
Good roads link up the national socioeconomic arteries, centres and hubs. People move about and perform everyday activities, mostly by road. It is also by the road that people go to earn a living, farm, or access other transportation modals like rail, air, and water.
Essential social services such as education, healthcare, hospitality, community integration, neighbourhood security, religious and private interactions are majorly accessed by roads. A quality road network is therefore the mainstay of any thriving economy.
For instance, out of Nigeria’s 108,000km of surfaced roads, those categorised as federal roads make up 32,000km or 18 per cent and had steadily deteriorated in the period preceding the current administration through a combination of official neglect, a poor maintenance culture, and perhaps more fundamentally, the absence of a legal and policy framework for private sector participation in funding, management and maintenance of federal highways.
President Buhari approved, in 2020, the establishment of InfraCo Plc, a world-class infrastructure development vehicle, wholly focused on Nigeria, with combined debt and equity take-off capital of N15 trillion, and managed by an independent infrastructure fund manager. He also established in the same year, the Presidential Infrastructure Development Fund (PIDF), with more than $1 billion in funding so far.
The Nigerian Sovereign Investment Authority (NSIA) has seen total additional inflows from the Government of around US$2 billion under the Buhari Administration since the original US$1 billion which the Fund kicked off within 2012.
Then, of course, there was the launch of the Nigeria Innovation Fund, by the NSIA, to address investment opportunities in the domestic technology sector: data networking, data centres, software, Agri-tech, Bio-tech, et cetera.
More specifically, Buhari, in June, launched the 157km Lagos-Ibadan Standard Gauge Rail (SGR) after its commercial construction began in March 2017.
The 150km/h line which also has a 7km branch was constructed by the China Civil Engineering Construction Corporation (CCECC).
Under the current administration, the 327km Itakpe-Warri Standard Gauge Rail has been completed and commissioned 33 years after construction began. The Abuja Light Rail was also completed in 2018.
The ground-breaking was done for the construction of Kano-Maradi Standard Gauge Rail, and revamp of Port-Harcourt-Maiduguri Narrow Gauge Rail while financing negotiations are ongoing for the Ibadan-Kano Standard Gauge Rail project.
The Presidential Infrastructure Development Fund (PIDF) has invested over a billion dollars in three flagship projects: Lagos-Ibadan Expressway, Second Niger Bridge, Abuja-Kaduna-Zaria-Kano Expressway. The president also signed an Executive Order 7 mobilizing private investment into the development of key roads and bridges like Bodo-Bonny in Rivers and Apapa-Oshodi-Oworonshoki-Ojota in Lagos.
The president also incepted the Highway Development and Management Initiative (HDMI), a public-private partnership programme to mobilise, in its first Phase, over a Trillion Naira in private investment into the development and maintenance of 12 Roads, amounting to 1,963km in length.
He initiated the raising of more than N360 billion worth of Sukuk Bonds since 2017 for dozens of critical road projects across all six geopolitical zones and authorized the completion of New Terminals for International Airports in Lagos, Abuja, Kano and Port Harcourt. Construction of a New Runway for Abuja and Enugu International Airports was also on the cards.
The President also approved four International Airports as Special Economic Zones Lagos, Kano, Abuja and Port Harcourt.
He approved new private-sector funded deep seaports: Lekki Deep Sea Port (Construction already well underway, for completion in 2022); Bonny Deep Sea Port (Ground-breaking done in March 2021); Ibom Deep Sea Port; and Warri Deep Sea Port.
With the development of capacity at the Eastern Ports, in December 2017, Calabar Port commenced the export of bulk cement to Tema Port in Ghana. In 2019, three container ships berthed at Calabar Port, for the first time in eleven years; dredging of Warri Port (Escravos Bar-Warri Port channel) was completed in 2018. On 30 October 2019, an LPG Tanker operated by NLNG berthed in Port Harcourt for the first time an LPG ship berthed in any of the Eastern Ports.
On 8 December 2019, Onne Port received JPO VOLANS (owned by Maersk), the FIRST gearless and largest container vessel (265.07 metres) to call at any Eastern Port in Nigeria. On 1 August 2019, Onne Port’s Brawl Terminal received MSC GRACE, its first container vessel since 2012.
On the housing front, the Family Homes Fund Limited (FHFL), incorporated by the Federal Government of Nigeria in September 2016, is the implementing agency for the Buhari Administration’s National Social Housing scheme.
More than two thousand (2,000) hectares of land with titled documents have been given by 24 States for the Buhari administration’s Social Housing programme, with the capacity to accommodate about 65,000 new homes.
Under the National Social Housing programme, Nigerians will be given at least 15 years with a monthly payment at a 6 per cent interest rate, to pay for each housing unit.
The Central Bank of Nigeria is providing an N200 Billion financing facility, with a guarantee by the FGN.
The Buhari administration’s infrastructure rollout has not been without its critics.
Questions have been raised about the dominance of construction firm, Julius Berger in projects, the extensive involvement of China and even the wisdom of building a rail line to Maradi in the Niger Republic.
Buhari has also been accused of prioritising development in the North of the country, where he hails from. But Transport Minister Rotimi Amaechi has dismissed these insinuations as needless.
From the Niger Delta in the South, he has pointed to significant projects in Rivers State, Lagos and other parts of the South.
So far, despite distractions and detractors, the President remains firmly focused on providing the infrastructure goodies that accelerate physical and human development.
Mr Chukwuma, the public affairs analyst, writes from Abuja.
Appraising the politics of Buhari’s infrastructure development, by Lewis Chukwu
