By Bolaji Ogundele, Abuja

The Federal Executive Council (FEC) has approved the resumption of the Federal Capital Development Authority (FCDA) land swap plan.

Minister of the Federal Capital Territory (FCT), Mohammed Bello, announced this yesterday while addressing State House correspondents at the end of the week’s virtual Council meeting presided over by President Muhammadu Buhari at the Presidential Villa in Abuja.

The plan, which was put at about N1 trillion under the previous dispensation, was designed to remedy the infrastructure deficit in the FCT by swapping land with private investors who would in turn provide necessary infrastructure.

Bello said the FEC approved the resumption of the plan, following a memorandum he presented to the Council.

The minister said some amendments were made to the original plan with the establishment of a legal framework to protect all parties.

“Today at the FEC meeting, I presented a memo and an update on the FCT Land Infrastructure Swap Initiative at the Council. And after a lot of deliberations, the FEC approved the FCT Land Infrastructure Swap initiative, which is popularly known as Land Swap. This was started sometime ago by previous FCT administration.

“After a review of what has transpired over the years, and changes made, the FEC approved that we now continue with the land swap initiative on the basis of amendments to the procedures as well as new safeguards introduced so that investors, the FCT, that is the government, as well as off-takers, will be protected. So, this is what we discussed today,” he said.

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Bello explained that the initiative is between the FCT administration and the private sector that would provide the infrastructure to develop the districts in the territory.

The minister said that under the plan, the private investors will provide all the infrastructure within a particular district and be paid for with land.

“They will take a certain percentage of the land developable within that district, while the FCT administration will take a certain percent.

“The essence is to encourage the development of the city according to the master plan in designated districts. Then, of course, it’s to also resolve the issue of compensation and payments and relocation of people as the city grows, to reduce the overall housing deficit within the FCT.

“So, basically, this is the background.

“And what we approved today is to establish a very solid legal system, whereby all the parties in this transaction are protected. The first party is the investor; the second party is the FCT Administration, while the third party is the off-takers.

“And in so doing, investors will create a special purpose vehicle, whereby the investors will come in and then the quantum of the investment will be determined on the basis of which financial institutions will provide financial guarantees to the administration through performance bonds.

“And this performance bond will cover the totality of the project and will be reducing as the project is being delivered.

“And then, the land that is going to be used as swapping for the investment, that is going to be held in custody by designated financial institutions, which will serve as the custodians. Because, of course, as milestones are being achieved, land will be released to the investors which, obviously, they will sell and use to pay for their investment. So, this is the whole concept,” he said.