Nigeria Needs $100bn for Infrastructure

From Kunle Aderinokun in Abuja

The Federal Government has said massive investments in critical infrastructure such as power, transportation as well as the development of the Niger Delta region and agricultural sector has been estimated to contribute about 25 per cent to the gross domestic product (GDP).
But such investments, the government said, will in the next six years gulp over $100 billion - or N12 trillion, nearly twice the size of the nation’s external reserves and almost five times the size of the 2008 budget.
In a presentation entitled “A framework for Pricing Public Goods: Objectives and Characteristics”, at the Nigeria Economic Summit in Abuja, yesterday, Finance Minister, Dr. Shamsuddeen Usman, said over the next six years, Nigeria would need to invest over N12 trillion in four key sectors, namely power, railways, roads and oil and gas.
Usman explained that for power, the nation would need between $18 and $20 billion for necessary investments in six years with about $10 billion for railways. He added that, roads and oil and gas would gulp $14 billion and $60 billion in investments respectively within the same period.
He however said the government could not meet the financing requirements alone, thus, asking for increased collaboration between the public and private sectors.
To him, the private sector was a “more preferred” method of financing infrastructure provision.
Usman noted that, increased private sector provision in Nigeria required effective and efficient pricing mechanisms, especially as it relates to cost recovery and reasonable rate of return.
The finance minister stressed that closing the infrastructure gap and improving the quality of public services remained the major components of President Umaru Musa Yar’Adua’s Seven-Point Agenda.
Speaking at the dinner organised for the summit on Wednesday night, the Chief Economic Adviser to the President, Mallam Tanimu Yakubu, said concerted efforts were being geared towards the maintenance, upgrade and expansion concurrently of critical infrastructure.
An appropriate framework has been developed to attract private sector participation and investment in infrastructure development, he said.
He said the administration had identified as priority areas for domestic and potential inward investment “power generation, distribution and supply; transportation including roads, railways and inland waterways; telecommunications especially laying of fibre-optic throughout state capitals and other commercial cities in the country and; investment in national gas grid for supply and distribution for power generation, petrochemicals and fertilisers”.
Yakubu estimated that the success of the administration’s ability to fulfil the objective of investment in the power sector, would fetch the economy an additional 5 per cent growth.
He explained that as part of its strategies, the administration had planned to increase the utilisation of existing energy capacities and also widen the nation’s energy mix.
“In this respect, the administration has set itself short, medium and long-term targets for power generation under its critical infrastructure agenda. In the short-term, power generation is expected to be in the region of 4000 MW (2009), 6000MW (2010) and 10,000MW (2011),” he said.
Noting that the administration’s medium-term objective was about 18,000MW, he stated that to fund the project, a $5.37 billion from excess crude proceeds account was agreed with the state governments.
Yakubu, who said the administration recognised the benefits of adequately utilising the nation’s large gas reserves, said: “We now have a National Gas Master Plan incorporating domestic gas supply obligation, appropriate pricing framework, national gas grid and gas fiscal reform.
“We also have in our sight the building of three Central Progress Facilities to be established in the Niger Delta to process gas and transmit this across the nation. We are also striving to establish regional processing hubs across the nation and facilitating the establishing of gas-based industries, power plants and export project alongside. The construction of the national gas grid will resuscitate our ailing industries al over the country.”
This, he said, would add not less than 3 per cent to the GDP in the short run.
Similarly, the presidential adviser said bold proposal on road concessioning and aggressive road sector development as well as maintenance programme which is expected to cover an estimated 5700 kilometres, has been estimated to contributed an additional 4 per cent to the growth of the GDP.
He lamented that currently, the GDP suffers a loss of 4 per cent due to unmotorable conditions of the country’s road.
Also, Yakubu posited that the Federal Government’s railway strategy would add at least 3 per cent growth to the GDP in the short-run.
“The Western, Eastern and Central Railway networks are to be rehabilitated and concessioned too. The infrastructure Concession Regulatory Commission (ICRC) is expected to commence work in due course,” he explained.
Yakubu added that the government’s proposal to strengthen the telecommunications sector would deepen teledensity and facilitate the use of internet in health, education and business to spur further growth in information technology.
In the agricultural sector, the adviser said the administration was resolutely pursuing a policy of sustained support for small-scale farmers, developing medium and large-scale and piloting the implementation of the warehouse receipt system in the food security agenda, which is capable of adding 5 per cent to the GDP.
Achieving the administration’s security targets by enforcing the laws of the country and guaranteeing the security to life and property in the Niger Delta, Yakubu said, would add 3-4 per cent to the GDP.
According to him, “a regional transformation in accordance with the Niger Delta Development Master Plan is expected to be achieved through timely and adequate funding and collaboration between the Federal and the state governments mainstreaming small business development initiatives, enforcing local content policy in the oil and gas sector as a way of widening local production.
“The development of a regional grid alongside an effective international transport system that connects the Niger Delta with other parts of the country is also in the pipeline.”

By Michael Chika Umudu

Militants and Politics of Niger-Delta

A lot of noise has been made about resource control, militancy, the provision of basic infrastructure as well as the role oil companies supposed to play in the Niger Delta region. However, it is either that the stake holders have become ignorant or immersed in sheer pretence about the real problems in the region. The problem is the hard truth which the government and its apologists always try to nip in the bud. It is the part of problems that have left Nigeria underdeveloped despite its huge human and material resources. It is the question of ‘how is Nigeria composed and how should its component parts relate with one another; who owns what and how should the resources be shared’?

The proliferation of violence in the region in recent time shows how dangerous the situation could be if the stakeholders refuse to take the bull by the horn. The militants are becoming more sophisticated. Criminals have seized the opportunity to cause confusion and havoc in the region and make fortunes out of the volatile region. It is now difficult to distinguish genuine freedom fighters and common criminals. The cause is not far fetched. It started when Nigerian left ‘a burning houseto chase an escaping mouse’.

Federal government be haves as if it loves the people of Niger delta more than they love themselves. It therefore approaches each peace initiative as if the best solutions are known only to people in the government. This situation has been worsened by sycophants in the region who usually tell government that the problem of the people is the provision of employment opportunities and infrastructure. They would assure their godfathers in government that once these are provided the whole problems would come to an end. Even the much awaited employment and infrastructure seem very slow in coming. It is said that ‘a master piece cannot be carved out of a rotten piece of wood’. It is therefore not surprising that as soonas these sycophants get allocation from their masters to provide the much awaited infrastructure and employment they would immediately bounce on the money and make a feast out of it. They therefore deceive both their godfathers and Niger Deltans who they claim to represent.

The failure of leadership is the root cause of the whole problem. When leaders abandoned their people to pursue personal agenda, obviously ‘the centre can no longer hold’. The disillusionment of the people over those claiming to be their leaders is the root cause of Niger-Delta problem. The leaders of the Niger-Delta, just like their compatriots in other parts of the country, have refused to apply courage and present the cure interest of their people. Instead, they are busy pursuing political appointments which they believe can only be achieved through representing the interest of their Abuja based godfathers irrespective of what their people feel in the creeks. It is these godfathers that will assure them political offices and when they get into the offices, they display maximum royalty to their sponsors in appreciation. Their quest to retain their offices and indeed get bigger ones makes them to feign ignorance of what their people are yearning for. They equally know that their kinds wouldn’t have smelt public offices if things are done the normal way. They know that their people wouldn’t have voted them if free and fair elections are held. Hence, they display the highest level of self-service even if the future of their people is at stake.

Today, what makes one a leader in Nigeria is his ability to pledge full royalty to those in higher authorities irrespective of what they do. It is not surprising that each government become bad only immediately it leaves office. The same people who served and benefited under a given government would turn around to label it anti-people in other to exonerate themselves from any wrong-doing directed at the government in question. It happened to Ibrahim Babangida’s military junta. It also happened to the despotic regime of Sanni Abacha. Not spared is the immediate past government of Chief Olusegun Obasanjo.

No wonder South-South governors refused to come out openly to condemn the appointment of Professor Ibrahim Gambari to chair the rejected Niger-Delta Summit. It is amazing that while many groups, personalities and indeed the masses of Niger-Delta were condemning the appointment of Gambari, the governors who supposed to speak for the people kept mute or openly supported his appointment in order not to offend their Abuja based sponsors.

It is only in Nigeria that the government will try to justify the appointment of somebody who described some of the epitomes of Niger-Delta struggle as common criminals. If Gambari could describe the likes of Ken Saro-Wiwa as criminals then how can he be appointed to mediate in crisis between federal government and those who began where the Saro-Wiwas stopped? One of the reasons why Abacha killed Saro-Wiwa was to suppress the struggle for resource control or regional autonomy which Saro-Wiwa personified in other to make fortunes from the resources of the region. It is a pity that men who call themselves leaders now shy away from the real issues, just because they are afraid of the power-that-be or because they are only interested in their pockets.

If these governors and other political office holders cannot come out boldly to champion the cause of Niger Delta then one should not be surprised that the militants are generating sympathy from groups and individuals in the region and beyond, including eminent personalities like Edwin Clerk and Anthony Enahoro who don’t drink from the same cup with the powers in Abuja. Militancy in the region is a child of misrule which has been on since oil was first discovered in the region little before independence.

It is the kinds of Anthony Enahoro and Edwin Clark that Abuja powers don’t want to see in political offices. The game plan is that if they plant their cronies into the political offices to represent the region, just as they do in other regions, their interests will be fully represented. And as the result any call for sovereign national conference, resource control or restructuring of Nigeria will be tagged the ranting of separatists and rebels. By doing so, they believe that the international community will believe them. Their strategy is to deceive the international community and groups in Nigeria who are not familiar with the Niger Delta. It is not surprising, therefore, to hear the authority say “Those who are saying the contrary are the enemies of Niger Deltans, as you can see, the elected leaders from the region are saying what we are saying”.

If people like Nelson Mandela had preferred to dine with the apartheid government in South-Africa the freedom that South-Africans enjoy today wouldn’t have been possible. The struggle may take long but it is only truth that will win the final battle. It therefore does not suffice to sell one’s birth-right simply because one is threatened or wants to occupy a public office. It is only when genuine leaders of the Niger Delta mount political offices that the present situation would begin to end.

Government should know that the militants are not only becoming sophisticated in warfare, they are also becoming much more sophisticated in knowledge. As the result they want to have a direct control of their resources and decide the kind of political structure or system that would satisfy the aspirations of their people. The World has become a global village. And the militants and indeed all Niger Deltans are part of it. The Niger Deltans can no longer be cajoled into believing that ‘a well-fed servant is as important as his master’. ‘A servant is a servant and a master is a master’. No group in the world today wants to play a second fiddle whether oil is involved or not.