Emefiele: Nigeria Requires N35trn Infrastructure Investments For Double-Digit Growth

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*Urges govs to make states economically viable
*FG to screen projects for PPP suitability

The Governor of the Central Bank of Nigeria (CBN), Mr. Godwin
Emefiele, has said Nigeria requires about N35 trillion investments
in infrastructure for the economy to post a double-digit
growth.

But Emefiele, in a goodwill message he delivered yesterday at a
webinar on “Financing Public-Private Partnership to Boost
Infrastructure Delivery in Nigeria,” organised by the Bureau of
Public Enterprises (BPE) in Abuja, added that given the paucity of
government revenues, it will be difficult to support such
investments using government funds alone.

The Nigerian economy, which is just crawling out of recession,
recorded a 0.51 per cent growth in the first quarter of 2021 after
a 0.11 per cent growth in the fourth quarter of 2020.

Besides, Emefiele, at another forum yesterday, also called on
governors to make their states economically viable in order to
reduce their dependence on allocations from the Federation
Account.

Emefiele, whose message to the webinar was delivered by the
Deputy Governor of the bank on Economic Policy, Dr. Kingsley
Obiora, stated that the theme of the webinar was topical as a
critical part of efforts to drive sustainable growth of the
economy.

He said the COVID-19 pandemic had exerted unprecedented impacts
on the economy, adding that interventions by the monetary and
fiscal authorities had led to Nigeria exiting recession with muted
growth.

He said: “While this news is positive, growth is still well
below our population growth of 2.7 per cent. It is therefore
imperative that we all work together to harness the growth
potential of the Nigerian economy.

“If we take into account Nigeria’s Infrastructure Masterplan, we
require close to N35 trillion worth of investment in order to
attain double-digit growth. But given the paucity of government
revenue, which the BPE director-general mentioned earlier, it will
be difficult to support these investments using government funds
alone.

“So, finding ways to harness public-private partnerships have
become very important and we are happy to acknowledge that these
partnerships have started in earnest and the Central Bank of
Nigeria looks forward to continuing collaboration with the BPE to
harness these partnerships to ensure that we significantly scale up
investment in our infrastructure.”

In her keynote address, the Minister of Finance, Budget and
National Planning, Dr. Zainab Ahmed, said from the 2021/2022 budget
cycle, all infrastructure projects in Nigeria must be screened for
Public-Private Partnership (PPP) suitability and compliance with
the National Integrated Infrastructure Master plan by her ministry
and the BPE before inclusion in national budgets and subsequent
procurement.

The minister, who is also the Vice-Chairman of the National
Council on Privatisation (NCP), said: “All these efforts are to
ensure that PPP takes a center stage in the procurement of
infrastructure in Nigeria.”

According to her, the federal government is willing to discuss
and incorporate suggestions from stakeholders with a view to
strengthening Nigeria’s PPP framework.
She stated that the webinar was an opportunity to hear from
participants on the concerns and areas they want the government to
address to make investment beneficial and deliver value to the
country.

She solicited the support and cooperation of the public and
private sectors partners, local and foreign partners, financial
institutions and other important key stakeholders towards the
successful implementation of the new PPP policy directive.

She added that the present administration is committed to the
development of infrastructure through PPP arrangements.

The BPE Director-General, Mr. Alex Okoh, also said in line with
its new role in the administration of concession programmes of the
federal government, the bureau, in collaboration with the Ministry
of Finance, Budget and National Planning had developed a PPP
project information tool, which has been forwarded to all
ministries, departments and agencies (MDAs), to capture all current
and proposed infrastructure projects in the country.

“This will help document a pipeline of PPP projects across
various sectors of the economy,” he said.

He added that some MDAs have submitted their PPP Project
Information Data ahead of the final submission date of May 31.

According to him, the bureau will partner the United Kingdom
Nigeria Infrastructure Advisory Facility (UKNIAF) to screen
projects to ensure that only those that are financially as well as
economically viable are included in the ‘National Pipeline of PPP
Projects’.

He stated that the BPE will also establish a revolving Project
Development Fund (PDF) for PPP transactions, while funds realised
from the pool will be used to facilitate the proper structuring of
PPP transactions.

He expressed hope that financial institutions will support the
initiative to increase the number of viable projects that could be
successfully brought to commercial and financial close in the
infrastructure space through PPPs.

Emefiele Urges Govs to Make States Economically Viable

Also yesterday, Emefiele called on governors to make their
states economically viable in order to reduce their dependence on
allocations from the Federation Account.

Emefiele, at the inauguration of the Rivers State Cassava
Processing Plant in Oyigbo Local Government Area of the state, also
told reporters that there was no devaluation of the naira, contrary
to speculations.

He, however, lamented that notwithstanding the country’s
position as the largest producer of cassava in the world, it spends
over $580 million to import its by-products, adding that the
country can no longer afford to support continued importation of
items that can be produced locally.

Emefiele said the CBN had set aside N1.5 billion for land
clearing and urged the states, particularly those in the southern
region, to take advantage of the facility to open up their
respective economies.

He also advised the governors to woo private investors to help
resuscitate their economies to generate employment through
agriculture, adding that this will help the states boost internally
generated revenue.

While commending the Governor of Rivers State, Nyesom Wike, for
the cassava project, he encouraged other governors to emulate the
gesture to empower the citizens.

He said: “We seize this opportunity to encourage our states,
particularly the southern states, that there are facilities
available for you to draw to involve in land clearing.

“At least, N1.5 billion is available for land clearing. It may
seem small but it’s a seed that we can start with.

“We need to see to how we can open up our states for the good of
our people and also for the economic viability of out states.

“Please, help to make your states economically viable so you can
depend less on revenues from FAAC so that you can grow your
economy.

“You can encourage private sector who need these processed
materials for their final produce.”

On the rumoured devaluation of the naira, he said: “Naira was
not devalued, it’s just the handiwork of mischief-makers.

“People just go about, do your business. Naira was not devalued,
we will continue to do our business and Nigeria will continue to
prosper.”

However, Emefiele stated that the cassava project is designed to
support improved production and processing of the commodity into
high-quality flour.

According to him, such investments could help drive economic
growth, reduce unemployment as well as induce other wealth-creating
activities in the state.

He added that it also helps support the CBN’s mandate of
promoting economic growth for the country.

The CBN governor expressed delight that the project would
improve livelihoods, as well as enhance the sustainability of
farming for over 3,000 farmers by guaranteeing the offtake of their
farm produce.

He said this guaranteed off-take would encourage participating
farmers to improve their output per hectare in order to earn
additional income.

He also said the project provided them with a verifiable
platform to access finance from the CBN and other financial
institutions through the Anchor Borrowers Programme (ABP) among
other benefits.

He said with the ability to process over 45,000 tonnes of
cassava, the facility would provide high-quality cassava flour for
households, industries and bakeries.

Emefiele added that about N7.43 billion had been accessed by
four out of the six states in the South-south region to open up
more land for cultivation, create access roads to agricultural
lands and provide infrastructure among other support services in
the region.

According to him, these measures are helping to induce greater
activity in the agricultural sector and are enabling the movement
of goods from farm to factories, and to the markets.
Emefiele said the current situation had made it imperative for the
central bank to work towards supporting programmes to enable
greater cultivation and processing of key agricultural
commodities.

He said so far, the apex bank’s developmental finance
initiatives had been focused on creating an enabling environment to
drive both public and private sectors’ participation in the real
sector with strategic deliverables around price stability, job
creation, financial inclusion, import substitution and accretion to
foreign reserves, among others.

He added that the bank’s interventions seek to improve access to
credit for households and businesses, which will enhance
productivity and create value across a wide range of economic
activities.

Emefiele said so far, the Rivers State Government had accessed
over N13 billion from the CBN’s various intervention
programmes.

He said: “As I said earlier, we have given them over N10 billion
which have been fully repaid. And anytime they ask for money
because he (Wike) is a very good debtor, we will always give them
the facility.

“You heard him say that around May next year, even a year before
he hands over, that he would have no debt. So he can come and take
the money and pay back next year.”

On his part, the Minister of Agriculture and Rural Development,
Alhaji Sabo Nanono, said the country must strive to grow its food
despite the current security challenges facing it.

“Obviously, we cannot succumb to our security challenges, we
have to eat, we have to farm whether there is security or not and
that is absolutely necessary.

“The security matter is not affecting agriculture alone but the
entire country, and I think in spite of all the security issues
people have been raising, agriculture has been growing in this
country even last year.
This season’s dry farming will multiply what we have done last
year,” Nanono told reporters.