FG To Prioritise Infrastructural Investment To Boost Economy – Osinbajo

Prof. Osinbajo said this while speaking at the African Development Bank Knowledge Sharing Forum in Abuja on Thursday.

The Vice President, who was represented by the Special Adviser to President Muhammadu Buhari on the Economy, Dr. Yemi Dipeolu, explained that the country is set to experience an economic boom as President Buhari has made investment in infrastructure a major priority and policy focus.

He said: “There are also various estimates about the impact of infrastructure on growth but the broad consensus is that the relationship is a positive one if the example of countries like China is anything to go by. Accordingly, given its significant infrastructure deficit, Nigeria is most likely to experience growth if significant investment is made in the building of roads, bridges, railways, ports, airports, housing, dams, telecommunications facilities and electric power.”

According to him, “In the 2016 budget, government has proposed to spend N1.84 trillion on capital projects, amounting to about 30% of the entire budget. Even though this is unprecedented in recent times, there is a realization that this figure is still way below what the country should ideally be investing in infrastructure. For instance, it is estimated that Nigeria requires about US$25billion annually for the next 10 years to grow its infrastructure to sustainable levels. It is obvious that this cannot be funded entirely by the public sector which brings the Public-Private Partnerships (PPPs) model to the forefront of our considerations.”

Speaking also, the Minister of Finance, Mrs. Kemi Adeosun, restated the Federal Government’s commitment to improve the operation of the Public Private Partnership (PPP) arrangement.

According to her, the present administration believes that functional PPP is key to resolving the infrastructural challenges of the country.

Adeosun was upbeat that solving Nigeria’s infrastructural problem is an important step to pulling the nation out of its current economic hardship.

“As far as our financial strategy is concerned, we are very committed to PPP and for us, the way to accelerate it is for the Federal Government to de-risk the involvement of the private sector and gradually, introduce the private sector to the PPP. This is because if we wait for every law to be changed and regulations to be amended, we will really not get any single project done,” the minister stated.

She disclosed that the Federal Government plans to start with a number of transactions in 2017, and that it will use the federal guarantee to simply take the risk away from the risky avarices of the projects of, for example, road projects which is risky.

“So we will de-risk; we will guarantee and will allow private money to crowd in to these transactions. It is something we must crack because clearly, our infrastructure deficit is so large that even if we spend our entire budget on infrastructure for the next five years, we cannot bridge the gap, so we must be able to get private money,” she added.