PUBLIC-PRIVATE PARTNERSHIP IN ROAD INFRASTRUCTURE DEVELOPMENT IN NIGERIA  

On August 6 2007, the federal Minister of Transportation Diezanni Alison-Madueke after an assessment tour of the Ore-Benin Road, A major link road between the western and eastern parts of Nigeria, lamented over the harrowing experiences of those who use it. So deplorable was the condition of this road that the Minister was moved to tender an apology to Nigerians. But ten months after her lamentation, the President Yar’Adua’s regime has not done much to improve on the decayed road infrastructure inherited from its predecessor. Often times, vehicles still have to negotiate through forests to beat traffic hold ups incidented by bad portions of the road.

But the Benin-Ore road is just one among a whole catalogue of failed highway pavements. The degeneration of the Shagamu-Benin, Ore-Okitipupa, Oshodi-Badagry, Owo-Akure-Ilesha, Maiduguri-Monguno, Bama-Banki-Gwoza, Biu-Maiduguri, Port Harcourt-Enugu, Onitsha-Owerri-Aba, and the Enugu-Abakaliki express roads is a cause for great concern to anyone who has the interest of this country at heart. Indeed, it is stating the obvious to say that many of the federal roads across the country are in a state of disrepair notwithstanding the outrageous amount which the Obasanjo Administration claims to have spent on them.

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The N800 billion road contracts have become a subject of enquiry at both chambers of the National Assembly. At present there are reports that over two hundred and fifty members of the House of Representatives have signed a document in support of a proposed probe of the road sector under former President Olusegun Obasanjo. Like in virtually all previous administrations in Nigeria, there had been claims that government only released a small percentage of what was budgeted for these roads. Since no former administrator was ever brought to book for failure to make available the funds needed for road construction, maintenance, and rehabilitation, Nigerians do not express even an iota of faith in the proposed road probe. This probably explains why there has been an increasing demand for public-private partnership for road infrastructure development in the country, in line with tested practice in other nations.

Argentina, China, Malaysia, Indonesia Thailand, and the Philipines are now engaging private concerns to build modern toll-motorway networks on Build, Operate, and Transfer (BOT) basis. Chile and Colombia are also not left out in this BOT style concession. This strategy allows private participants to collect tolls on the countries’ main highways in return for the duty to carry out a programme of maintenance, rehabilitation, and construction.

The idea of involving the private sector in the nation’s ‘critical infrastructure’ development is not misplaced as thinkers across the political spectrum will agree because it is believed that the private sector is the driver of modern economic development. It is also noteworthy that while economic theorists hold the view that Africa’s private sector is one of the least developed in the world, Nigeria boasts of a burgeoning private sector that ranks among the very best in Africa and even in the world. At present, the Nigerian Banking System is reputed to be the fastest-growing in the continent. One report has it that using the United States dollar market capitalization as a yardstick, about 11 of the 12 Companies in West Africa that have a market capitalization of at least 1 billion dollars are Nigerian companies and seven of them are Banks; 44 of the 50 largest companies in West Africa are Nigerian Companies and 22 of these are also banks. Similarly, 29 of the 50 largest companies in sub-Saharan Africa are Nigerian and 14 of these are as well banks; and of the 16 companies in sub-Saharan Africa that have a market capitalization of at least 1 billion dollars, 7 are Nigerian banks, while 4 age non-bank Nigerian companies.

The successful revolutionization of the Nigerian financial sector did not occur by accident. It was as a result of the consolidation programme which injected best practices into the banking sector. The country now boasts of 25 strong banks, the emergence of which is expected to have far-reaching effects on the financing of Nigeria’s infrastructural development projects, especially the roads.

Considering the lending power and the entrepreneurial spirit of the banks and the entire private sector as criteria for involving them in the nation’s road infrastructure development programme is just not sufficient. The growth of the private sector particularly the manufacturing industries depends, to a large extent, on good road network which provides them access to the markets. Incidentally, Analysts have confirmed that besides the issue of high interest rates from banks, another critical factor that has proved the undoing of the manufacturing industries and the Micro, Small, and Medium Enterprises (SMEs) in Nigeria is poor infrastructure which includes the roads. As a matter of fact, Nigeria can never boast of a robust economy without the manufacturing industries and SMEs having their pride of place. It is against this backdrop that the clarion call by Nigerians for a revolutionized approach to the problem of road infrastructure development hinges.

To skeptics though, this idea might seem like a pipe dream but in the real sense the private sector are alive to their obligations as responsible social citizens. For instance, during the immediate past regime, the Lagos state government through an organized Public Infrastucture Improvement Programme (PIIP) enjoyed a partnership wit a consortium of companies. These Companies drawn from the Banking, Insurance, Oil and Gas, and Hospitality and Tourism industries carried out the rehabilitation of major roads and streets that were in a terrible state of disrepair in Lagos. Besides, there is a widespread belief that many other companies, in conjunction with the banks, are in a position to do more and on a grander scale so long as the projects are well structured in a way that the banks can identify with. For this programme to have a smooth sail however, a lot still depends on the government.

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Looking at the performance of the banking sector on an international scale, it is generally believed that Nigeria has the potential to be one of the largest economies in the world. The government should therefore aim at transforming Nigeria’s financial system into a catalyst for development. This should be followed with the establishment of a harmonious and collaborative environment for public-private partnership in infrastructural development. Additionally, the government should ensure that in any concession contract for highway infrastructure development, there is a clear-cut agreement on issues of payback. The story will not be palatable if the road users are eventually left at the mercy of the entrepreneurs who would want to recoup their investment, possibly through the collection of tolls, within a very short period of time.

Finally, the government should consider the establishment of a National Transport Commission that will regulate transport operations in Nigeria, bearing in mind that Funding alone cannot solve the problem of decay in the road transport industry. Regulation, Control, Training, and Education are also critical to the issue of proper use of road infrastructure.

By Chigozie Chikere

Traffic Data Analyst

7 Samuel Ladoke Akintola Boulevard

Garki 2, Abuja.

E-mail: grandefather@yahoo.com