By Obas Esiedesa, Abuja
Experts have backed Central Bank of Nigeria’s effort to set up a N15 trillion infrastructure fund through the InfraCorp Plc, but also called for the adoption of public-private-partnership model to ensure its sustainability.
The experts, who agreed that Nigeria needed about $3 trillion to bridge its infrastructure gap, stated that the fund would ensure the country’s economic growth, wealth creation and employment opportunities for its teeming young population.
The N15 trillion infrastructure funds currently being championed by the Central Bank of Nigeria alongside African Finance Corporation and the Nigerian Sovereign Investment Authority is scheduled to be launched in October.
Governor of CBN, Godwin Emefiele had disclosed that the fund is expected to make available private capital that would support infrastructure investment and by extension have a multiplier effect on growth across critical sectors.
With inflation hovering around 17.33 per cent and unemployment at over 33.3 per cent, the experts who spoke in Abuja yesterday observed that investments in infrastructure in the country is below par.
Former President, Nigerian American Chamber of Commerce and Chairman of Tricontinental Group, Olabintan Famutimi noted that while the infrastructure deficits in the country remained worrisome and require intervention like the CBN funding, the country must tread wisely.
He expressed concern about channeling fund into viable projects with economic benefits instead of politicizing economic and business decisions.
According to him, “We have huge infrastructure deficit. We need infrastructure but it is more about which infrastructure government is working on, funding source and the conditions of the fund as well as the overall effect on the economy”.
Famutimi insisted that raising fund to finance infrastructure is not enough but critical examining of the economic outlook of the projects and the multiplier effects of on the nation remained sacrosanct.
On his part, a Senior Lecturer at Ahmadu Bello University, Zaria, Prof. Muhammed Usman, that Nigeria spent about three percent of its Gross Domestic Product (GDP) equivalent on infrastructure yearly in infrastructure, between 2009 and 2013.
“Infrastructural development plays a pivotal role in enhancing economic growth, improving living standards, reducing poverty, and contributing to environmental sustainability”, he added.
Also speaking, a Professor of Economics at Babcock University and former President, Chartered Institute of Bankers of Nigeria (CIBN), Segun Ajibola noted that several hundreds of thousands of road network, rail lines, energy and power, water and others remained critical but sadly inadequate or dilapidated.
Prof. Ajibola pointed out that the gaps in infrastructure constrain the nation’s economy despite the growth in population, urbanization and technological advancement, adding that the need for the provision of these essential infrastructures remains inevitable yet daunting.
He said: “Hitherto, some reliance had been placed on other sovereigns such as China, international financial institutions such as the World Bank, ADB, etc. But there is limit to which what Nigeria can attract from these countries and institutions because of the not too friendly conditionalities usually imposed on developing countries like Nigeria.
“Looking inwards in the manner being proposed by the CBN may be helpful. But then, the framework must be right. I will recommend a Private Partnering via collaborative arrangement between local and foreign interests adjudged competent in providing such infrastructures,” Ajibola noted.
He noted that PPP would improve on the quality of delivery, performance and accountability, noting that such interventions were expected to berth with relatively generous terms and business-like template.
Ajibola urged the apex bank to introduce framework for monitoring performance, which must be efficient and effective, adding that there must be shift from seeing intervention funds as free public funds, adding that such mentality must be tackled head long if the infrastructural fund would achieve the desired goals.