FG Woo Investors, Promises Return On Investment, Secured Environment

Minister of Transportation, Engr. Mu'azu Sambo

The Federal government has assured investors of promising return on investment and guaranteed secure environment on partnership with the transportation sector in Nigeria.

According to a statement by the Director of Press and Public Relations in the Ministry of Transportation, Eric Ojiekwe on Wednesday, the minister, Engr. Mu’azu Sambo, disclosed this during his presentation titled, “Financing Nigeria’s Transport Infrastructure” at the Nigerian International Economic Partnership Forum, held in New York recently.

The minister said, “the environment is conducive, Nigeria has a record, unbroken 24 years of democracy, we have an executive order for making businesses easy and we have a very fair legal system in Nigeria where investors’ rights are protected”.

According to Sambo, the role of transportation infrastructure in Nigeria is aimed at reviving the economy, transforming it and placing it on a more sustainable and inclusive growth strategy, laying emphasis on inter- modal transport infrastructure connectivity, roads, railways and waterways, each contributing to the functioning of the Nigerian economy.

Speaking further, he said the rail sub- sector has recorded notable achievements, the commissioning and making operational for commercial activities, the Abuja- Kaduna; Warri- Itakpe – Ajaokuta and Lagos – Ibadan double track standard gauge rail lines, ground breaking of wagon Assembly in Kajola, Ogun State, Port – Harcourt – Maiduguri, Kano – Maradi (Niger Republic) and Kano – Kaduna Standard gauge rail lines, connection of the Apapa ports by rail, while that of Warri Port is ongoing.

“In this regard we have already ongoing projects from Lagos all the way to Kano, from Kano to Maradi in Niger Republic, we have the Eastern line connecting Port- Harcourt and Maiduguri, it is the narrow gauge we are rehabilitating, we would have loved to have the standard gauge linking the two major cities and other cities, both in the South and in the North”,  Sambo said.

Nigerians’ major focus is to ensure that every Capital city of Nigeria is connected by rail because every part of the country is blessed with abundant natural resources that need to be moved quickly into markets.

He said, Nigeria has over 850kms of coastline strategically placed along the gulf of Guinea and the whole idea is to connect the six seaports in Nigeria located in the south to the hinterland and even beyond.

On the need to attract the biggest shipping vessels to the country, the Federal Government initiated creating of deep seaports with an average draught of 15m, “The six seaports of Nigeria were built in 1980’s, one or two of them were built around 1913 and 1921 and a lot of them require massive upgrade and rehabilitation”, stating that the major one is the Apapa – Tincan port which contributes and accounts for about 70% of Nigeria’s imports.

The Minister said, the Lekki deep seaport was about to commence operations anytime soon and was built on a BOOT basis, by Lekki Port LFTZ Enterprise Limited with a concession period of 45 years, the Badagry deep sea port has been recently approved by the Federal Executive Council (FEC) for construction by international private investors over three years on concession for forty – five (45) years also on a BOOT basis.

He also said the Bonny and Bakassi seaport were the other ongoing initiatives for deep seaport which present themselves as opportunities for private capital and that the Ibom deep seaport was in the process of procurement.

He therefore, welcomed investors to establish more deep seaports and work out agreeable terms for the limited resources available.

The Minister explained that, in order to decongest seaports, improve supply chain logistics and bring shipping activities closer to shippers in the hinterland, Nigeria initiated the development through the Nigerian Shippers Council, of inland dry ports as ports of origin and destination.

So Nigeria now has a fully operational inland dry port in Kaduna, while other inland ports in Kano, Kastina, Aba, Ibadan, Jos and Funtua were at various stages of development and completion.

Other achievements include rail connection to the Inland Dry Ports in Kaduna and Kano, commencement of container movement from Apapa port to Ebute – metta, Ijoko and Ibadan to reduce traffic gridlock among others.

While, the Inland waterways sub-sector in Nigeria has about ten thousand kilometers (10, 000km) of potentially navigable waterways out of which only three thousand kilometers (3000km) were currently navigable all year round, this, how noted creates a lot of opportunity in the inland waterways subsector as an alternative, cost – effective and environmentally friendly mode of transport connectivity.

On transportation infrastructure financing, the Minister said, the transport infrastructure could be funded through government or private sector financing.
Government funding options would include budget funding (Budgetary allocation, enhanced statutory allocation and viability gap funding) and off budget financing (Special intervention funds, bonds, low interest concessional loans, financing from aid and donor agencies etc.)

The private sector financing options would typically include pension funds, long- term commercial bonds, multilateral agencies, export credit finance, private equity, infrastructure funds, PPP etc. Adding that Public Private Partnerships (PPP) has proven a viable option to unleash unprecedented infrastructure growth and create a balance between State Ownership and Privatization.

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