the Managing Director of Infrastructure Bank (TIB) PLC, Mr. Adekunle Oyinloye, has reassured users of the Lagos – Ibadan Expressway that work on the N167 billion project will be completed by July next year.
Oyinloye, in a statement in Abuja after the bank’s board meeting, said motorists have nothing to fear about the completion date regardless of the current lull on the construction work.
He promised that work would resume as soon as the legal issues surrounding the project were resolved.
Construction work, he said, had already reached 30 per cent.
He said additional financial commitments have already been secured from the project financiers through whom, he added, the initial N50 billion was raised for the project.
He said that all the stakeholders on the project, including the Federal Ministry of Works, the Infrastructure Concession Regulatory Commission (ICRC) and the contractors – Julius Berger PLC and RCC – were determined to meet the completion date target.
Oyinloye commended the perception of the Minister of Power, Works and Housing, Mr. Babatunde Fashola, on the state of infrastructure in Nigeria and the concept of Public Private Partnership in rescuing them from decay.
He also announced plan by the bank to construct a 280-kilometre ”green-field dual carriage way” that will link Abuja with Ibadan through Kwara State.
There is a reason for the high spirits at the institution. The ambience is great. Space seems to be put in better use, as new lecture halls, staff offices, faculty buildings, Senate building and hostels stand in their right places. There are lawns and flowers and the air seems purer these days.
There is more. Road network has improved and you can drive or walk with more ease.
Still, the story of FUTO is more than infrastructure or greenery. It is one of cleaner academic processes leading to its leap from its 48th position out of 100 Nigerian universities in 2011, to 12th, according to a web ranking.
FUTO stakeholders have Vice Chancellor Professor Chigozie Asiabaka to thank for that.
He relished the improved facilities but the VC was just as happy with the school’s integrity profile and the harmony in the work force.
Unlike in the past, when the university was bedevilled by decayed infrastructure and disenchanted work force, FUTO is better positioned to compete favourably with other leading universities in the world in terms of academic quality, first-class infrastructure and human capital development.
The students and staff alike in a chat with The Nation attributed the success to the VC’s ingenuity as well as the commitment of both the academic and non-academic staff of the institution.
The VC, now in his fourth year, said that on taking office, he laid out his vision and mission which was to “re-position FUTO to be a top-ranked world-class university of excellence in technological knowledge production and dissemination, through teaching, research and service to humankind.
“I laid the roadmap for my five-year tenure. I espoused my vision and mission and these were encapsulated in my mantra the ‘Quest for Excellence’, which means following the part of transparency, accountability, probity, zero tolerance for corruption and equity in the daily activities of the university”.
There was opposition but it did not matter. Asiabaka, in his own words, “still went ahead to stop the exploitation and abuse of our students through the sale of handouts and insisted on the release of examination results four weeks after the end of each semester examination. I also stopped the exploitation of parents and guardians and indeed candidates wishing to gain admission into FUTO by putting an end to examination racketeering. The exploitation of our graduates within and outside the country was also stopped by ensuring that they get their transcripts within 48 hours of application and the collection of their certificates immediately after convocation.”
Another major area of development that has been highly commended within and outside of the university is the full computerisation of the activities of the institution. Today all transactions of the university are done electronically including admissions, financial transactions, Senate and Council meetings, among others.
He said, “Unlike what was obtained before I assumed office, all the activities of the university are now computerised. Today we have the e-Senate, e-admission, e-payment, etc. In the past Senate and Council meetings normally take up to two days but today as a result of the e-Senate, all meetings can be concluded in a matter of hours. The e-transaction has blocked leakages of University funds and made the system more efficient.
“Information and Communication Technology deployment in the University has witnessed a substantial leap in the last four and a half years. When we came in, we worked hard to achieve early deployment of a campus-wide internet access facility and the establishment and use of Edu-portal Solution in FUTO. The adoption of this platform significantly aided the computerisation of major university activities such as online processing of applications for admission and post-UTME placements, On-line payment of school fees and processing of students’ clearance, Deployment of FUTO-TPS (Transcript Processing Solution) for processing transcripts and Automated Staff pay-roll system and use of Electronic Payments for settlement of bills”.
On the academic activities, which he said is the main purpose of establishing any academic institution, the Vice Chancellor, hinted that, “our curriculum and academic contents have become more dynamic and robust in tandem with aspirations of a globalized knowledge driven economy. Within the last one year, the university presented programmes in the School of Agriculture and Agricultural Technology, Engineering and Engineering Technology, Health Technology, Environmental Sciences, Physical Sciences, Biological Sciences and Management Technology to the National Universities Commission (NUC) for accreditation. A total of 41 programmes were assessed and 39 got accreditation and we have commenced the process to have a Medical School in FUTO.”
The university according to The Nation findings, has also made good progress in the area of internalisation through the establishment of concrete academic linkages and the promotion of viable outreach programmes both locally and overseas. Some of the affiliating Universities include, the University of Georgia, Athens, Dillard University, New Orleans, The City University College, Cork, Ireland, Budapest University of Technology and Economics, Budapest, Hungary, Egerton University, Njoro Kenya and Galilee International Management Institute, Isreal, among others.
•Prof. Asiabaka
Asiabaka who was quick to attribute the success of the last four and a half years to the team spirit exhibited by the staff, said that he, more than any other previous Vice Chancellor of the university, is committed to staff welfare.
He said, “My administration has consciously pursued a policy of improving the welfare of our staff. Promotions of deserving members of Staff, both teaching and non-teaching have duly been released. Basically the University is created for the Staff and it is on record that this administration has surpassed any other administration in terms of staff welfare. When I assumed duty as Vice Chancellor the first thing I did was to start looking at how do I make the Staff work because one individual cannot do the work.
“When I came in the issue of staff promotion was addressed. It is on record that I have promoted more people than anybody, from 2011 to today, we have promoted a total number of 466 academic staff, 44 of them to the rank of Professor, 73 as Associate Professors and in the non-professorial cadre, I promoted 349. In all in the last four years I have promoted a total of 466 academic staff and 2,205 non-academic staff. Under my leadership the University instituted long service award and rewarded recipients with handsome gifts.
“We have also as a matter of policy recruited all first-class and second-class upper degree graduates of this university through the graduate assistantship scheme to create a new set of young and vibrant generation of academic staff.
“On post-graduate training, the University is sponsoring 75 Ph.D students in both foreign and local universities, 30 Master Degree students, apart from sponsorship of national and international conferences”.
On students welfare, the Vice Chancellor, observed that the students as the main focus of the University system are accorded a pride of place, adding that his administration took “positive steps that strengthened the Students’ Affairs Unit”, which he said improved on Students’ Support Services.
The 2015 homecoming of Ngwa High School, Aba Abia State Old Boys’ Association attracted the presence of some of the Alumni of the school who made the event colourful, SUNNY NWANKWO reports.
Ngwa High School is one of the early male schools in Aba, the commercial hub of Abia State. The school which was founded in 1952 with Rev. W.G. Pollard as its pioneer Principal has produced many successful businessmen, clerics, top ranking soldiers (both serving and retired) and other professionals such as Chief Mike Ahamba, Prof. Uche Ikonne and acting Vice-Chancellor, Abia State University Uturu Prof. Jasper Fortune Jumbo, among others.
However, the 2015 gathering of the school which coincided with the Golden Jubilee of the class of 1965 of Ngwa High School Boys Association (NHSOBA) set provided these legal icon, clergies, business gurus and other professionals, the opportunity not only to relish the old school days as students in a secondary school that was the pride of the commercial city then, it also provided them the opportunity to plan on how to restore the pride of the school; having been returned to the original owners (Anglican Church) by the immediate past Governor of Abia State, Senator Theodore Ahamefula Orji. For them, the infrastructural decay in the school is awful.
According to the Old Boys, their planned partnership with the present management of the school under Aba Ngwa North Anglican Diocese to give their alma mater a facelift, they were embarking on a N10 million project investments.
Among the projects they intend to carry out in the school are sinking of borehole and reticulating water to every part of the school, including the students’ dormitory among other places.
Chief Mike Ahamba, a Senior Advocate of Nigeria (SAN) and President of the schools’ Old Boys’ Association of the school announced this in Aba as part of the celebration to mark the golden jubilee of the 1965 class.
President of NHSOBA lamented the level of dilapidation of infrastructure in the school founded in 1954. He promised that the association would partner with the church to address the infrastructural challenges as well as re-establish high standard of learning which the school was known for.
He said: “We are here for our homecoming and to take a look at the state of infrastructure in the school and see how we can help. The buildings are old and most of the students are day students. We will invest at least N10 million in the first instance of the infrastructural rehabilitation of the school.
“We would like a situation where most of them would come into residence and that will help to inculcate in them the true character of Ngwa High School personality. We will ensure that immediately we leave here, students of the school will enjoy water from the borehole sunk by the Old Boys’ Association and it will be reticulated. After that, we won’t wait; we will go on to achieve other projects.
“We enjoyed water system and showers in the 1960s. Why won’t our students enjoy them now? I commend the Vice-President of NHSOBA, Chief Jasper Jumbo for renovating the school’s chapel and library and Dr. Chianyigadi Denna who re-roofed and installed metal doors to the science blocks.”
Ahamba also said that the association will do all within its capacity to restore the glory of the school.
“We will try and get it right. It will be a continuous thing. We are doing it for a lot of reasons; this is the only school that bears the name, Ngwa. I believe the Ngwa nation will see it as something they must support even though the Anglican Mission is running it now. But they built the school and gave it to the Anglican Church. That’s what happened in 1953. Now that the Anglican Church has it again, Ngwa people should not turn their back on this citadel that is flying the flag of Ngwa land.”
Corroborating Chief Ahamba’s views, Prof. Jasper Fortune Jumbo said they were willing to partner with the Anglican Church of Aba Ngwa North Diocese; owners of the school to see ways the glory of the school could be restored which he said would attract parents to sending their children/wards to the school for studies in order to be better equipped academically.
Earlier in his address, the Principal of the School, Dr. Felix Erondu, who is also an old boy of the school, had enumerated the challenges facing the institution to include lack of laboratory facilities; dilapidated buildings, broken fence and lack school bus.
Brig. General G.A. Umelo; Deputy Inspector-General of Police (DIG) Ali Amodu; Justice Kenneth Amadi; Mr. Emmanuel Denna, Gordy Uche (SAN); incoming ABSU Vice-Chancellor, Prof. Uche Ikonne; Mr. Eric Archibong and Mr. Chianyidi Denna were among the old boys honoured by the group.
Nnewi, the industrial and commercial capital of Anambra State, was on Christmas eve, thrown into confusion and mourning when an LPG gas plant operated by Inter Corp Oil Ltd, a subsidiary of Chicason Group, exploded.
The explosion, which occurred around 11 am, reportedly resulted from a leak when a consignment of gas was being uploaded to the company’s dump. Some of the people at the plant were said to have been burnt. Others who were in the neighbourhood and passersby were caught in the inferno.
The victims were rushed to Nnamdi Azikwe University Teaching Hospital (NAUTH), Nnewi. The fire did not allow rescue workers access into the factory where the majority of the victims were trapped. Sadly, all efforts to get the attention of the Anambra State Fire Service failed, according to an eye witness who spoke with The Nation.
An eye witness, who escaped death by the whiskers, said a fire officer, Mrs Mary Ofia, excused fire service personnel when she claimed that the fire truck was vandalised by a mob when they went for an operation at Nkpor, a community in Anambra. He said apart from the fact that the Fire Service’s equipment were non-functional, it took them time to get to the factory. He said by the time they retreated and came back, the inferno had done incalculable damage.
Apart from lives lost to the inferno and buildings razed, over 50 vehicles around the gas plant were equally affected. Some dead victims were actually recovered in their homes.
However, while the company and family members of the victims are still struggling to come to terms with the reality of what hit them, attempts by people to shift the blame for what happened to the wrong place may have added to their sorrows.
Rather than commiserating with the people and coming up with new strategies to avert such occurrences, The Nation learnt, government agencies seem to be adding salt to the injury of the people who lost relations, friends and business by accusing the company of unsubstantiated claim of operating substandard facilities.
A report exclusively obtained by The Nation confirmed that some industry operators who toured what was left of the factory after the fire confirmed that the business was run on what could have met industrial standards anywhere in the world. Relevant industry regulatory bodies, according to the report, also approved the facility.
One of the members of the tour team who declined to be because he was not authorised to speak, said the fire was one of many industrial accidents that confront businesses daily, and necessitates government standing up for the citizenry, both individual and corporate.
He said rather than shift blame, the question should be: How did government agencies respond to this particular incident? Could some of the lost lives have been saved had the government responded better? What is the hope of better response from the Fire Service and emergency management arms of government for the various businesses that operate in the same vicinity in the face of similar happenstance?
He said the explosion was a sad reminder of the need for the government to walk its talk in the provision of necessary infrastructure and equipping its relevant emergency response agencies, particularly the Fire Service. He said it was curious that Nnewi despite being home to many manufacturing outfits cannot boast of an efficient and effective fire service.
The first locally made automobile in Nigeria was produced by INNOSON with its factory in Nnewi employing thousands of people. The industrial city has over 30 major factories, 50 cottage industries, 10 major hotels with over 10, 000 direct work force. Its contribution to the nation’s Gross Domestic Product (GDP) has yet to attract any special treatment from either the Federal or State Government.
The thriving industrial town boasts of companies with billions of naira as turn over yearly. Yet, the lack of an efficient fire service has continued to pose serious risk to billions of naira worth of investments made by private investors.
However, Minister of Interior, Abdulrahman Danbazau, has assured that more proactive measures will be taken to prevent future re-occurence.
The Minister said this when he visited the state on Wednesday to sympathise with the government and people of Anambra State. He was accompanied by the Comptroller-General of Fire Service and his counterpart at Civil Defence.
The Managing Director FBN Capital Limited, Kayode Akinkugbe, has said the commercial banking community alone cannot meet the requirements for Nigeria’s infrastructure financing.
He spoke at a discussion panel on ‘The Nigerian Capital Market: A Catalyst for Change,’ during the 2015 Business Luncheon of the Capital Market Solicitors Association (CMSA) held in Lagos.
Akinkugbe said Nigeria is at a point in its development where the issue of infrastructure has become extremely critical.
“Our infrastructure deficit requires us to invest around 30 billion dollars a year for the next decade to catch up. The financing requirements are far much more than what the commercial banks can cope with. There is therefore a clear gap, and the right segment of the financial market to fill the gap is the capital market,” he said.
He explained however that strengthening liquidity in the capital market is very crucial, especially for confidence. “If we have counter parties that have strong capital, there will be much more activity in the capital market. Currently, we really don’t have a lot of well capitalized institutions. Being well capitalized means you can make investments in distribution,” he said.
He submitted that to make the investments that are required, properly capitalized institutions are needed.
Head Legal and Regulations, Nigerian Stock Exchange, Ms Tinu Awe, expressed that there are three paradigm adjustments that needs to be made within the Capital Market industry. Firstly, operators need to collaborate together to challenge the status quo of the financial market.
The 678-kilometre West African Gas Pipeline (WAGP) can transform the region into an investment hub, if stakeholders invest in gas infrastructure, Head, Energy and Power, Ecobank Plc, Mrs Olufunke Jones has said.
She said the pipeline, which cuts across Nigeria, Ghana and other countries in the sub-region, can transform the economic landscape.
Speaking during a stakeholders’ forum on Wednesday, last week in Lagos, Mrs Jones urged operators to assemble and transport gas molecules to where they are required for socio-economic growth.
She said operators would benefit if there is increased investment in gas infrastructure.
Mrs Jones said: ‘’The challenge we are facing in the power sector is not that of turbines, but that of aggregating the gas potentials for growth. Stakeholders should try and increase investment in gas infrastructure. Once they are able to do this, access to gas by users across the broad spectrum of oil and gas industry, would not be a problem. Besides, the price of gas is going to be competitive and the better for players in the industry.’’
She urged operators to look for ways to access funds, and invest in critical components of the oil and gas sector.
Mrs Jones said debts would reduce once the power distribution companies (DisCos) adopt what she described as ‘’Strategic Debt Collection Method.’’
‘’What I mean by strategic collection is that the DisCos should strategise on how to increase revenue collections from 60 to 65 per cent; 67 to 70 per cent; and thereafter move to 80 per cent or 100 per cent. This is possible if stakeholders can do the needful by increasing, investment in the gas industry,’’ she added.
Kwara State government will spend N56 billion on infrastructural development in the 16 local governments next year.
It said of the amount, it would obtain N20 billion bonds from the capital market.
Governor Abdulfatah Ahmed, who spoke at the weekend in Ilorin when addressing stakeholders, said: “The bond is one of the ways we will devise to execute capital projects next year.”
He urged council chairmen to improve their internally-generated revenue (IGR) to augment the shortfall in the federation account.
Said Ahmed: “We must look for alternative if we must continue as a government. The dwindling allocation from the federation account is why we have arrears of primary schools’ and local government workers’ salaries.
“This is why it behoves the State Universal Basic Education Board (SUBEB) and council chairmen to examine how they spend their money. At the state level, we will endeavour to pay workers according to what accrues to us. Payment of primary schools and council workers lies with the local governments.”
Governor Okezie Ikpeazu of Abia State may have drawn from recent history to drive the two concepts of physical infrastructure and stomach infrastructure simultaneously. He is running on the two lanes; building the badly dilapidated roads of Abia and particularly renewing the city of Aba and at the same time building human capacity by attending to the people’s immediate needs. Two of his pet projects – the Friends of Abia Schools Adoption Initiative (FASAI) and Feeding of School Pupils obviously fall in the line of stomach infrastructure.
Indeed, until Governor Ayodele Fayose of Ekiti State popularized the concept of stomach infrastructure and drove on that plank to oust an incumbent governor out of power, Nigerians never knew the dangers of ignoring the concept and the inherent power and goodwill derivable from the practice for a leader. It is today a proven theory that upholding the practice of stomach infrastructure must be an essential character of a political leader and political leadership in Nigeria of today. It has since entered into our political books that the victory of Fayose over the incumbent Governor Kayode Fayemi in the June 21, 2014, was the vindication of the wisdom in stomach infrastructure.
The lesson that emerged thereafter from the Ekiti scenario was that, for effective and impactful political leadership, both physical and stomach infrastructure must be given due consideration by any leader who wants to remain a legend in the hearts of the citizenry. The two are meaningful goals of democracy and therefore none must be emphasized above the other. The two must run concurrently. Okezie Ikpeazu got this message, loud and clear.
What then is physical infrastructure as against stomach infrastructure? Physical infrastructure relates to the building of physical projects – roads, bridges, hospitals, schools, monumental buildings, etc. Today, Ikpeazu is constructing 45 roads and two bridges in Abia and these cut across the three geopolitical zones of the state. It is no more news, also, that he is constructing four roads in Aba with cement technology or what experts call, rigid pavement technology thereby blazing a trail as far as this technology is concerned in Nigeria. This is because apart from the airport tarmacs and factory platforms where big engines and machines are installed, cement technology is not yet a common experience in Nigeria, especially in road construction. He is daring the nationwide economic crunch to execute this high cost intensive project at this straightened time.
On the contrary, stomach infrastructure looks down to the people’s immediate needs: empowerment programme for unemployed youths and widows; maintenance assistance to the aged; health foundation to assist the poor; agric facilities for the rural poor farmers; skill acquizition centres for poor unskilled men and women; loan grants to enable them take off in little measure; direct food relief to the poorest of the poor; borehole in rural communities to solve water scarcity problems; establishment of small-scale cottage industries in the villages where the rural community can work and also acquire experience on how to produce minor things and many more.
Indeed, it is from this perspective that the governor has launched his pet project of Feeding School Pupils in 170 primary schools in the state, three times a week. Under the Universal Basic Education provisions, the governor is driving a pilot arrangement of feeding primary school pupils three in 10 schools in the 17 local councils of the state. The pupils are to be fed on Mondays, Wednesdays and Fridays. This action will have to be executed in schools in the rural areas with high indigent population. The target public is the poorest of the poor, pupils from indigent homes who study under very unhealthy situations. The governor wants to create an enabling environment for them and share his little milk of human kindness.
Also, as part of his 51st birthday celebration, the governor also launched the school adoption initiative and invited the friends of Abia to come and rediscover their roots and give back to the communities that made them by adopting indigent pupils and volunteering to renovate the dilapidated structures of the schools. This project is a novel idea which is a bit different from government tradition of renovating and equipping primary schools in rural, urban and semi-urban areas. The approach is to identify the worst primary schools in each of the local councils and give them a facelift with the hope that when the worst of these schools are upgraded, the effect on the entire primary school system will be enormous.
The governor regretted that the primary schools which form the base of the entire school system have long been neglectted for long due to a number of factors, which include lack of Old Boys Association, Parents Teachers Association etc. He noted that pupils in these schools are exposed to extreme weather conditions including sitting on bare floors. Thus, the aim is to use the project to turn around the poorest primary schools across the state. The project is designed to give hope to pupils from poor schools by getting well-to-do individuals within and outside the state to adopt such schools and in the process enhance their fortunes and by extension the intellectual horizon of the benefiting pupils. Most of the influential members of the public are products of these schools which in their heydays were glorious institutions. Ikpeazu’s motive in this project is to provide an opportunity for these notable citizens to give back to the society, in this case, the schools that produced them.
In the same vein, the governor also announced a N20,000 monthly stipend for the first 125 intakes of the newly commissioned Skill Acquizition Centre built by the National Directorate of Employment (NDE) at Otueke in Ugwunagbo Local Council of the state. His wife is also running another pet project, Vicar Hope Foundation, through which she is attending to the immediate needs of widows, the handicapped and the less privileged in the society.
Stomach infrastructure, indeed is a moral suasion which is about giving governance a human face. It is about understanding the bottom-top, gradual approaches in developmental strides. It is about carrying everybody along, everyone in his own pace. By identifying the need for a convergence between physical and stomach infrastructure in Abia State, Governor Ikpeazu is interspersing power with remorse. Remember Shakespeare? “The abuse of greatness is when it disjoins remorse from power.”
LAST week, Minister of Finance, Kemi Adeosun, hinted of a plan by the Federal Government to set up a N4.98 trillion ($25bn) fund dedicated to infrastructure financing. Although scant details about the operations of the fund were provided, the minister left no doubts that the private sector will be involved. According to her, the decision to set up the fund for infrastructure is in recognition of the critical role of the capital market to the kind of economy the present administration intends to develop for Nigeria.
Her words: “In the current environment of significant revenue squeeze and other budgetary constraints, these investments will clearly not come from government coffers alone…We believe this is where the capital market can really make itself relevant by stepping in to close the funding gap”.
The much we can say about the fund idea at this time is that it comes to us as bold and refreshing. Bold – because it speaks to the urgency of the need to tap into alternative sources of revenue to bridge the infrastructure gaps in the face of declining revenues from oil; refreshing because, it speaks to the dawn of new thinking in our public finance in the face of glaring inadequacies of the budgetary system to tackle the infrastructure challenge.
A lot of course has been said about the features of our budgeting system and how this inhibits development. Topmost of this is the perennially disproportionate allocation in favour of recurrent as against capital expenditures. No less troubling are the perennial shortfalls from traditional sources of revenue from factors that are both endogenous and exogenous. In the former, the example is to be found in the non-remittance of due revenues to government coffers, while the current slump being experienced in oil prices best illustrates the vagaries from the latter. To the extent that revenues are mere projections of what the government believes are realisable, it is understandable that the constraints linked to such vagaries will also impose limits on what is achievable in a given budget year. In contrast, a project funded from an infrastructure fund is not expected to suffer such constraints.
A fund of the nature being proposed is therefore not only overdue but offering immense promises in terms of redressing the situation. Among its direct benefits is the potential to help increase the pace of delivery of vital infrastructure, to help bring about a reduction in the number of projects abandoned due to paucity of funds, while boosting the overall economy and hence generate jobs.
To be sure, what the country faces at the moment in infrastructure delivery is akin to a crisis of monumental proportions. All across the federation, the story is a familiar one of bridges in virtual state of collapse, of federal roads that are impassable and of waterways that are not navigable. It has been said – and we could not agree more – that were the entire annual budget for the next decade to be thrown at the infrastructure gaps, it would still fall far short of what is required to make an appreciable difference given the depth of the rot.
Aside the fact that only a tiny fraction of our annual budgets actually gets to be spent on infrastructure renewal, it is also the case that a fraction of that tiny portion is either stolen or misapplied, making the nation’s hope of imminent transformation doomed. The country therefore requires, more than ever before, a sustained anti-corruption war if the dream of infrastructure development is to be realised.
But the infrastructure fund remains only an idea. To the extent that a lot of work still needs to be done to make it a reality, our expectation is that the Federal Government will put every mechanism in place for its early realisation.
Concluding text of paper presented by Chairman, Bresson, Mr. Gbenga Olawepo-Hashim, titled: Nigeria: facilitating resilient and sustainable infrastructural development, during the Nigerian Students Society’s Annual Symposium at the Imperial College, London.
The participation of new Independent Power Producers (IPPs) in the sector are specially very crucial because whilst privatisation of existing utilities merely transfers ownership to the new operators, it is the new greenfield IPPs that add capacity to the network. Unfortunately, in the past five years no new IPP has been inaugurated in Nigeria. As a matter of fact last year no single turbine was imported to Nigeria and none has been imported this year, compared to 15 GE turbines that were shipped to Egypt this year alone.
Ten years running, this reform has been hampered by the difficulties associated with the private sector participation in infrastructure development identified previously. The difference here is, the sense of urgency that the resolution of these issues in the power sector demands. They are questions to which answers cannot be delayed further; they must be addressed right now! Policy formulators only lament and sing the power inadequacy like a song and failing to take the practical executive actions that do not even require legislation to achieve.
As an operator in this sector, I have outlined hereunder some immediate steps to be taken to recalibrate the power sector reform:
Dismantle the delay in licensing of IPPs and the signing of Power Purchase Agreement (PPA) through an executive guideline for the industry that defines Standard Operating Procedures for agencies and institutions. Processing licence applications and signing of Power Purchase Agreements should not take more than 90-120 days. Currently, it takes two to three years when, in fact, a complete Power Plant could be delivered between 18 and 24 months.
Federal Government should make Sovereign Guarantee available to all PPAs that the Nigeria Bulk Electricity Trading Company (NBET) concludes and with the requisite 90-120 days LC to ensure bankability of such agreements.
III. Distribution companies and eligible customers, once licensed, should be able to sign PPA with the Generating Companies (GENCOs) and IPPs for the supply of Power without the undue meddlesomeness of the Nigeria Electricity Regulation Commission (NERC). This is the provision of the Electricity Sector Reform Act and this is what it should be.
NERC should be professionalised and focused on effective regulation of the sector; meting out punishment for infractions in the sector rather than attempting to administer the sector as it is doing.
More attention should be paid to sanctioning operators, particularly in the distribution sector who have not delivered on their terms of purchase of their network as the entire value chain depend on effectiveness at this level.
A cost-reflective and fare electricity tariff must be put in place that guarantees reasonable return on investment and satisfies the consumer that he/she has been fairly charged. It is my assumption that an Industrial consumer will be willing to pay a reasonable price for what he/she consumes rather than spend N90/kw on self-generation. The wide spread use of pre-paid meter must be implemented immediately to make this regime work.
Surmounting the challenges to rapid infrastructural expansion
Ladies and Gentlemen, though the obstacles to accelerated infrastructural expansion in Nigeria are daunting they are surmountable. Once policy makers and implementers summon the will to immediately take far-reaching actions that are focused and sustained along the following lines;
Reordering government expenditure to allow for commitment of at least 50 per cent of government revenue to Capital Expenditure in the 2016 budget and with the aim of increasing to 60 per cent and 70 per cent in 2017 and 2018 budget cycle respectively.
The Federal Government should embark on Contractor financed infrastructure projects based on internationally benchmarked pricing; in the construction of rail tracks, supply of locomotives and coaches, and other critical infrastructure. Such selected projects must have the necessary projected cashflow to pay back to qualify for approval.
III. There should be an immediate bid process for the concessioning of two sites for the construction of two green field ports in areas with the natural port depths.
Immediate elimination of bureaucratic curtains, red tapes and elimination of duplication of regulatory approvals for private sector direct investment in infrastructural development as now common in the power sector. This is to be achieved by the instrumentality of a sectorial guideline that institutes a Standard Operating Procedure detailing timeline for processing applications with a high-level audit system of the processes.
The Federal Government should use its Sovereign Financial Instruments to give credit guarantees to strategic private sector investments in key areas such as power generation and transmission as well as other urgent infrastructural priorities. The external debt profile is comparably low and puts Nigeria in a good position to leverage its sovereign instruments for infrastructural growth. Nigeria’s debt to GDP ratio is 10 per cent compared to Brazils 58.91 per cent, South Korea’s 35.98 per cent, China’s 41 per cent, India’s 66 per cent, Euro zone’s 91 per cent and US’ 102 per cent.
Global Infrastructural spending is predicted to have a rebound within the next ten years. An Infrastructure-starved economy such as Nigeria, should position itself to receive a good slice of the funds. According to a research by Oxford Economist and Price water House Cooper about $78 trillion USD is to be spent on infrastructure globally within the next 10 years. Only 10 per cent of the money will be spent in Europe, 60 per cent in China and the Asia Pacific, the remaining will be spent in the rest of the world. Nigeria is in a good stead to attract a significant portion of the funds projected for the rest of the world especially those emanating from private funding institutions and infrastructure funds including pension funds. The IRR on Infrastructure investments in the country, which averages between 15-21 per cent after taking into account the allowance for risk premium and insurance makes the Nigerian market competitive if the manmade obstacles are immediately removed. IRR on projects in Nigeria, which could hit 25-40 per cent in oil and gas infrastructure compares favourably well in the emerging markets; a typical IRR trend in emerging markets is 12-19 per cent.
Restructuring the economy for a task of building a resilient infrastructure and an all- round socioeconomic development
Ladies and Gentlemen, whilst the above suggestions would suffice to kick start the process of rapid infrastructural development, they are inadequate to do so on a sustainable basis. The task will require the restructuring of the national economy with new set of goals, objectives, organisation and structure. The economy will have to be organised in a manner that can make the needed quantitative and qualitative leap.
Indeed, every economy in history that has witnessed transformation from a primary producer status to a modern industrial economy has had to undergo a rapid leap over an identifiable historical epoch. It is at such a time that the technical capacity for mass production of steel, machine tools, and chemicals are acquired. It is at such a time that manufacturing appears on a mass scale and solid minerals and agricultural are linked to industry.
For the Nigerian quantitative leap to be achieved the economy must target a double digit growth over at least ten years period; at such a time, the financial sector will be re-directed and aligned to the goals of financing a modern industrial economy.
We have listed below some important policy objective and goals that will form the direction of a new economy imbued with the capacity for achieving sustainable development;
a) Monetary and Fiscal Policy must be geared towards the growth of the Infrastructure, Manufacturing, Industry and Agriculture.
b) Tax and Revenue collection must be reformed to increase nationally collectable revenues.
c) Interest rate must be kept at single digit between six and eight per cent.
d) Economic planners must prioritise massive investment in iron and steel, meteorology, machine tools, glass production and petrochemicals.
e) SMEs and small agricultural producers should enjoy concessionary lending rates.
f) Foreign Exchange Regime must be stable to attract long-term investment.
g) Proprietary rights of individuals must be respected as well as the sanctity of contracts and agreements to make Nigeria an attractive destination for private sector investment.
h) Protection of Intellectual Property must be given high priority to spur innovation and the creative sector of the economy.
Bridging the social divide
Nigeria as a country cannot pull together in peace and stability for the goals of sustainable development if majority of her people still live in squalor and poverty whilst we relish in impressive GDP figures. The fact that more than 70 per cent of the population live in poverty and 60 million are illiterates [UNESCO] is both a scandal and a tragedy.
It is no longer news that our country is growing apart like an apartheid State. It is true that the middle class has grown six-fold in the past 12 years; so also are the numbers of complete illiterate citizens, mostly young people without any skill to participate in the modern world because we have in the recent past, surrendered the welfare of our people to market forces – the survival of the fittest! No wonder our impressive growth figures are blighted by massive upheavals in the underbelly of our country.
The social problems are not going to abate except Nigeria invests immediately in the welfare of the people. According to a recent study by the African Development Information Centre, by 2030, Nigeria’s population will grow to about 210 million; 70 million of this forecast population will be living in Northeastern Nigeria where there is an extremist insurgency; 35 million of which will be under the age of 15 and would not have received any form of formal education. This is alarming!
We must invest now to bridge the social divide by making primary and secondary education free of all cost with feeding and welfare support at primary school levels. This must be a federally financed program worked out with local authorities for effective implementation. Free education must be entirely free indeed without hidden cost such as examination fees and cost of uniforms.
The quality of educational and health institutions must be upgraded through the recruitment of qualified professionals, training and retraining of existing hands making available needed equipment and infrastructure and improving productivity and output through a scientific audit system that ties reward and emoluments to performance.
Nigeria must quickly introduce a comprehensive program of accessible, cost-free and qualitative health service coverage for all Nigerians. Nigeria can afford these programs right now as we are already spending billions of naira managing the social upheavals that are caused by decades of ignoring the welfare of the people especially the young and the vulnerable.
Conclusion
Ladies and gentlemen, Nigeria has all it takes to confront the urgent task of turning around her infrastructure and building an economy that will surpass all predictions. The country has the most important asset a nation needs to be at the top – a very determined people – never giving up when even no one gives them a chance to pull through. Just 17 years ago Nigeria had only 400,000 phone lines today Nigeria has about 100 million. Last year Nigeria pulled a peaceful election even when some predicted her disintegration. The country has the energy to confront her challenges coming up stronger and better even sometimes from behind. With strong determination and positive actions we will surmount our challenges!
Thank you for listening. God bless Nigeria, God bless her friends too!
