Government moves to concession 10 roads as Investors doubt sincerity
Nigeria said it will concession 10 major roads across its six geopolitical zones with the intention to attract about N163.32 billion private investment into the sector and reduce the effect of the paucity of funding.
However, investment experts are skeptical about the plans by the government to concession the major road networks in the country to private investors, saying the government needs to go back to the drawing board to tidy up loose ends.
In the proposed plan tagged “Highway Development and Management Initiative,” Works and housing minister, Babatunde Fashola told the National Assembly Joint Committee on Works that the concession was anchored on a private sector engagement.
The minister said investors would carry out the development and management of the road networks, noting that the scheme was meant to eliminate the negative impact of poor funding on road development.
Fashola said the first phase of the project is expected to attract capital investment estimated at N163.32 billion with each route generating at least N16 billion.
Successful investors are expected to provide toll plazas on those roads where they will collect fees from motorists plying the route, provide streetlights, rest areas and weighbridge stations.
However, the managing director of Afrivest Securities said the government has not been consistent with its concession programme, saying government concession with one hand and cancel with other hands.
According to him, the federal government is not doing enough about the enforcement of contracts, leaving investors to the mercy of successive administration.
“Concession today, canceled tomorrow! What’s the FG doing about “enforcement of contract”? Potential investors will be wary of signing any contract that outlive a current government. What happens when a new Govt comes into power and does not believe in this,” Ebo wrote on a thread on Twitter on Thursday.
Many investors had in the past made reference to the cancelation of the sales of the refineries to Dangote Group during the administration of President Olusegun Obasanjo, which was later canceled by the Musa Yar’dua administration.
There have been talks about the government revoking the privatisation of the power sector in recent time as a result of the poor management of the electricity supply by the distributions companies.
The argument had been that once the government takes any step to revoke the licences of the distribution companies, it may mar the plan of the government to attract private investment into the country.
Ebo tweet reflects the mindsets of many private investors who have demonstrated their lack of confidence in government concession and privatisation scheme, leaving the programme to politicians and charlatans to participate.
An economist said told our correspondent that many investors are wary of getting involved in government schemes as a result of the inconsistency in policy and a clear cut succession in policy from one administration to others.
“We even doubt the process of privatisation and concession because most time they are not transparency, leaving some questions in the minds of participants,” the economist who does not want his name in print said.
Nigeria is currently making move to concession 1Benin-Asaba, Abuja-Lokoja, Kaduna-Kano, Onitsha-Owerri-Aba, Shagamu-Benin, Abuja-Keffi-Akwanga, Kano-Maiduguri,a Lokoja-Benin, Enugu-Port Harcourt and Ilorin-Jebba road.