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Tag: Infrastructure deficit

  • Governorship candidates decry infrastructure deficit in Kwara

    •Moro communities decry neglect

    Governorship candidates of the Labour Party (LP), the African Democratic Party (ADP) and the Abundant Nigeria Renewal Party (ANRP) in next month’s elections, Comrade Issa Aremu, Isa Manzuma and Abdulmumin Ajia have painted a sorry of infrastructural decay in Kwara State.

    The trio said the state suffers from gross and worst infrastructural deficit and that many of the roads across the state have become deplorable.

    They made the remark in Ilorin, the state capital at the 2019 Kwara governorship debate, organized by the Kwara Coalition of Business and Professional Associations (KWACOBPA).

    Ajia promised to remove all forms of infrastructure deficit, if elected.

    He said: “I will remove the corruption and bottlenecks inherent in the current government’s infrastructural development. I will be transparent to Kwarans, by telling them how their money is being spent. I will revive the tourism sector, by putting people that have passion for it. We will have tourism calendar. I will invest in the marketing of all our tourism potentials to the world.”

    Aremu said he joined the governorship race to promote economic prosperity and growth of the state. The LP candidate said he had attempted to uplift the plight of people as a labour leader and that the time is auspicious to replicate such efforts in the political arena.

    He said: “Our party has a five-point development agenda. We will have a 10-year development agenda, to reduce the perennial energy problem in the state. We will try as much as possible to have multiple sources of energy.

    “We will get between 250,000 and 500,000 direct jobs from tourism sector. We will also open up our roads in all the three senatorial districts. We will give our people the purchasing powers. I will be on duty to revive all our tourist centres in the state.”

    On insecurity, the frontline unionist said he will work towards providing employment for the people. He added: “We will engage the services of traditional rulers to ensure security in their domains. Kwara under our watch will return to being a state of harmony.”

    Manzuma promised to revive some of the state’s tourism centres, including the famous Esie Monument in Esie, Irepodun Local Government Area. The former president of the Nigerian Bar Association (NBA), Ilorin branch, said: “I also intend to reactivate the moribund Kwara Hotels, in which all of us are sitting.”

    The KWACOBPA chairman, Dr Ahmed Raji, said the essence of the debate is to provide a platform for the candidates to unveil their agenda for the private sector, as encapsulated in their manifestoes and programmes.

    He said: “The economic and business agenda of the governorship candidates are therefore of strategic importance to existing investors and prospective investors. It is important for private sector to have an insight into the thinking of the candidates on the trajectory for the state economy.”

    Meanwhile, communities in Moro Local Government Area of Kwara State have decried their neglect and underdevelopment in the hands of the Peoples Democratic Party (PDP) government in the state.

    Read also: I’m next governor of Kwara, says Abdulrazaq

    They said the All Progressives Congress (APC) government at the centre, led by President Muhammadu Buhari, has improved the lot of the people at the grassroots in a number of ways.

    The spokesperson of the communities, Chief Wole Oke, said the communities have elected to pitch their tent the APC, because of its achievements. He said the Ilorin-Jebba road, which was in deplorable condition, has been tarred by the Buhari government.

    He said: “For the past 16 years I cannot point out any particular project the state government has done in Moro Local Government. They will tell you there is the Kwara State University (KWASU) in Malete, but how many indigenes of the local government are workers there. We have a situation where the catchment area is not gaining anything.”

    The former Afenifere scribe in Kwara State is confident that the APC would emerge victorious at the general elections. He added: “Our chances are very bright. If there is anything at all, the Kwara State APC will have landslide victory at this year’s polls at all levels.

    “Take each senatorial district and analyse them. Compare the strength of each party in each senatorial district. What we have is dominance of the APC in all the five local government areas that make up Kwara North district. About two months ago, you knew what happened. Saraki would never believe that the APC would win that by-election and that is a pointer to what will happen in the next three weeks.”

     

  • ‘Infrastructure deficit major impediment to growth’

    Lacklustre approach to investment in infrastructure remains a major impediment to Nigeria’s growth and development, a chartered stockbroker and Chief Executive Officer of Sofunix Investment and Communications, Mr. Sola Oni, has said.

    Speaking in Lagos, Oni said the sluggish approach to infrastructure investment was affecting economic activities with dire consequences for the real Gross Domestic Product (GDP).

    “A nation without infrastructure like energy, roads, rails and waterways cannot create an enabling business environment,” he said.

    The expert noted that top-notch, consistent investment in infrastructure will have multiplier effects of creating an enabling environment for businesses to thrive and also enhancing employment opportunities.

    According to him, conscious and constant investment in roads, rails, utilities, water and airways, among others, would aid job creation.

    Oni pointed out that if these measures were backed with appropriate fiscal incentives, there would be increase in spending.

    “Sadly enough, at 58, Nigeria is still contending with infrastructure deficit. This must be tackled with dispatch in order to ensure sustainable growth in our GDP.

    “The growth of GDP at 1.81 per cent in Q3 is tenuous. Concerted efforts are required to make the growth sustainable,” Oni said.

    Commenting on the 2019 budget, he said the 2019 fiscal budget had taken into consideration the challenging operating environment.

    “This is noticeable in the Federal Government’s deliberate reduction of the key drivers of the economy to ensure inclusive and sustainable growth.

    “The total budget estimate of N8.83 trillion is down from N9.01 trillion of 2018,” he said.

    According to him, security breaches, governance issues and vagaries in the international oil market, among others, created an atmosphere of uncertainty that enveloped the entire economy in 2018.

    Oni said the 2019 budget must be fairly conservative for effective implementation.

    “The benchmark price of crude oil at $60 per barrel and production of 2.3 million barrels per day are subject to controversy in view of the signals from the international oil market.

    “But the good thing is that the government is not unmindful of these and there are plans to switch gear in the event of unforeseen risks. The heart of 2019 budget is the cautious management of the economy by reducing the weight of debt burden and expanding the income generating streams,” he added.

    The expert also said the exchange rate of N305 per dollar was conservative, noting that the critical challenge was how to grow the GDP on sustainable basis and boost the external reserves.

    President Muhammadu Buhari had on December 19, 2018 presented a N8.83 trillion budget for 2019 before a joint session of the National Assembly.

    The fiscal plan for next year is smaller in size compared with N9.12 trillion budget for 2018.

    The proposed budget shows that about a quarter of the sum, N2.14 trillion, will be spent on debt servicing, while capital expenditure is expected to gulp N2.03 trillion.

    The government also plans to spend N4.04 trillion on recurrent expenditure and N492.36 billion on statutory transfer in the course of the 2019 fiscal year.

    The fiscal policy is predicated on crude production of 2.3 million barrels a day, an oil price of $60 per barrel and exchange rate of N305 to the dollar.

  • ‘LUC to tackle $50 billion infrastructure deficit’

    Since the beginning of its implementation last month, the Land Use Charge (LUC), a revised Lagos State property tax law of 2018, has remained in public discourse. The LUC, a consolidation of ground rent, tenement rate, and neighbourhood improvement levy, is aimed at raising revenue for infrastructural development in the state.  Notwithstanding the government’s intension, it has drawn criticisms from some sectors and polarised stakeholders in the real estate market. The Lagos State Commissioner for Finance, Mr. Akinyemi Ashade,  in this interview with real estate reporters,  explains the nitty-gritty of the LUC and how it will be implemented. MUYIWA LUCAS was there. Excerpts:

    What is Land Use Charge (LUC) based on and why its introduction at this time?

    The Land Use Charge(LUC) is not a new form of taxation.The Law backing it was first enacted in 2001. The LUC Law was repealed and re-enacted to address some identified challenges which include but not limited to lack of clarity on the LUC formula to support self assessment; obsolete rates which had not been reviewed in over a decade; need to improve LUC administration efficiency. The new LUC law also provides a robust legal and regulatory framework to support ongoing LUC administration reforms aimed at growing the state’s economy. LUC shall be payable in respect of all real estate property situated in Lagos State.

    In what area of the economy will government plough the proceeds from the LUC to?

    Governor Akinwunmi Ambode’s passion for infrastructure development has never been in doubt. His urban renewal, infrastructure development and employment drive requires humongous amount of money, not to mention healthcare delivery, housing, education, or security. Therefore, to meet the infrastructural challenges, occasioned by the ever-growing population, we would channel the proceeds of the new LUC to tackle $50 billion infrastructure deficit in Lagos within the next five years. To continue to renew our infrastructure and build new ones, we would need to spend $50 billion. With this reality, if we have to spend all our budget without doing any other thing, it would take 19 years to be able to fix the deficit and if the state government borrows money to meet the need, it would be at high interest rates. But who will even lend us such money? Therefore, the new tax regime is property taxation system.

    There has been resentment with the public and interest groups calling for a return to status quo ante. How would you react to this?

    Look, any sincere resident, especially property owners, would agree with the government that increase in the LUC was progressive because it collapsed three previous taxes into one. Besides, the previous LUC which became obsolete, was supposed to be reviewed every five years but was not updated for 16 years, hence the new LUC, which captured current economic realities. Also to reveal government’s consideration, openness and transparency of the new regime, it had different rates for property owners and relief of 40 percent on taxable property value across board. The state government will implement  the new tax regime with human face. Lagosians must trust us with the tax; we are going to invest it in infrastructure judiciously.

    How will the LUC affect businesses in the economy?

    The new LUC was factored to facilitate ease of doing business. Under the new Land Use Charge Law, owners-occupiers would be expected to pay 0.076 percentage of the value of the assessed property. For example, the retirees and those with any disabilities would be exempted from any form of payment. There is also an assurance that the government would protect tenants whom landlords might want to exploit because of the LUC.

    Do you share the position that the LUC may lead to reduction of investments in real estate sector?

    How will that happen? To start with, is tax payment a statutory obligation or punitive legislation? If it’s part of civic responsibility of citizens to pay tax, where is the error in paying land use charge? What I think people should be talking about is fairness of valuation, whether it’s arbitrary or just. And if you look at what we have been saying, you’ll see the sincerity of purpose on the part of this government as far as land use charge issue is concerned.

    So, how did you arrive at the percentage charged for LUC?

    The formula that shall be used to determine the annual amount of LUC payable is the Land Value + Building Development Value multiplied by Relief Rate and Charge Rate. The formular is [(LA x LR) + (BA x BR x DR) x RR x CR], where LA= area of the land parcel in square metres; LR= average Market Value of a land parcel in the neighbourhood, on a per square metre basis in naira based on Market Value of the property as determined by professional valuers appointed by the Commissioner for Finance for that purpose.

    What are the palliatives you have built into this LUC tax regime?

    There is 40 percent relief for all property liable to LUC. Also, a 10 percent relief for owners and occupiers, including persons with disabilities; a 10 percent relief for owners and occupiers of 70 years old and above; a 10 percent relief for properties above 25 years; a five percent relief for properties occupied by their owners for over 12 years; a 20 percent relief for non-revenue generating federal and state government property, and 20 percent partial relief for non-profit making organisations. In addition, some properties are exempted from the LUC payment, such as properties used for public and religious activities; properties used as registered educational institutes and charitable activities; properties occupied and owned by pensioners of 60 years and above; public cemeteries and burial ground and all palaces of recognised Obas and Chiefs in the state.

  • FG committed to ending infrastructure deficit 

    The federal government yesterday restated its commitment to end infrastructure deficit.

    Director General of Infrastructure Concession and Regulatory Commission (ICRC), Aminu Diko, stated this during a tour of the Calabar Port.

    He said President Muhammadu Buhari was worried about the level of infrastructure deficit across the country.

    Diko pointed out government was ready to deal with the situation through the Public Private Partnership (PPP).

    He said that the team was in Calabar port in continuation of its facilities tour across the country to ascertain the level of compliance by the concession operators.

    According to him, this follows the granting of concession to some terminals in various ports in Nigeria.

    The General Manager, Eastern Ports, Joshua Asanga, described the visit of the commission to the port as very instructive.

    He said that the tour would serve as a signal for the port operators and Nigerian Ports Authority to rededicate themselves to duty.

  • $40b infrastructure deficit threatens Africa’s devt

    Former Chairman, Goldman Sachs Asset Management, Jim O’Neill, has urged African governments to bridge the $40 billion investment deficit on the continent.

    Spaeking during the African Finance Corporation’s (AFC’s) conference on infrastructure in Lagos, O’Neill said infrastructure has been estimated  to add an average of two per cent to  economic growth over the next decade as its deficit is reduced.

    He said Africa’s future depends on the continent’s policy makers to do the right thing by working to create better governance, reducing crime, fight corruption and delivering improved infrastructure. Infrastructure development is both a defining challenge and a standout investment opportunity for Africa and investors around the world, he said.

    He said Nigeria is growing at seven per cent despite poor access to power,, noting that adequate power supply could boost economic growth to  about 12 per cent, adding that there is no reason why the country should not become one of the G20 members.

    The conference attracted more than 500 experts.

    AFC’s Chief Executive Officer, Andrew Alli said there are  potentials in Africa which investors can key into.

    “Our vision at the AFC is to bridge the infrastructure divide and seek a strong return for our shareholders at the same time. We believe our core role comes at the earliest stage of project conception and development. While international capital will be fundamental in bridging the investment divide, that capital will have nowhere to go if Africa does not focus on the development of bankable, sustainable projects,” he said.

  • Africa requires $100b to fix infrastructure – Jonathan

    Africa requires $100b to fix infrastructure – Jonathan

    President Goodluck Jonathan has said for Africa to effectively tackle the various challenges bedeviling the continent, it must build the necessary infrastructure across transport, communication and energy sectors.

    Already, it is estimated that the continent requires about $ 100 billion annually for the next decade.

    Jonathan, who spoke on Wednesday at the Infrastructure Summit of the World Economic Forum in South Africa, described infrastructure as a major challenge facing the African continent.

    Consequently, Jonathan said the situation has led to structural and high level of unemployment.

    Besides, he said poor infrastructure serves as additional burden and cost to businesses, thereby making it difficult for them to compete.

    The president said, “In the last decade, Africa has come a long way from being mainly associated with economic stagnation, high inflation, high external debts, and civil strife. Today, the situation has changed due to significant macroeconomic, structural, and political reforms. Economic growth on the continent averaged five per cent annually in the last 10 years.

    ” However, despite this recent economic growth success story of the continent, infrastructure deficit on the continent across transport, energy, and communication remain binding constraints to further growth acceleration, our ability to compete, and the reduction in poverty.

    “Inadequate and poor infrastructure in Africa remains a major constraint to the continent’s realisation of its full economic potential. Due to the relatively poor infrastructure and low connectivity on the continent, we have the lowest level of inter-regional trade. While we account for about 12 per cent of the world’s population, our share of global trade is just about two per cent. This is also a reflection of the fact that our economies are less diversified compared to other global regions.

    “Most importantly, poor infrastructure serves as additional burden and cost to our businesses, making it difficult for them to compete, and accompanied by structural and high level of unemployment. To effectively tackle these challenges, diversify our economies, reduce poverty and provide employment opportunities for our bulging youth population, we must build necessary infrastructure in Africa across transport, communication and energy sectors.”

    “Over the course of this past decade, African stakeholders have recognised the need to plug the gaps in infrastructure on the continent. From studies and reports on the subject, it is estimated that Africa requires about 100 billion United States dollars annually for the next decade, whereas only a quarter is being spent today.”