‘Nigeria’s GDP Growth Dropped from 7% Annually to 2.8% in 2015’
Dr. Ousmane Dore, Country Director for African Development Bank, has said that Nigeria’s GDP, which grew at an average of 7% per annum up until 2014, took a nose-dive in 2015 to 2.8%.
He spoke at Akindelano Legal Practitioners’ (ALP’s) fifth business seminar which took place last week Tuesday (26th April) at the Oriental Hotel, Lagos. It had the theme, “PPP and Infrastructural Development: Accelerating the Diversification of Nigeria’s Economy”.
The seminar was sponsored by ARM HarithInfrastructure Investment Limited, FBN Quest, AXA Mansard Insurance Plc., Environmental Accord Limited, Leadway Assurance Company Limited and Rand Merchant Bank.
Dore, who examined the impact of infrastructure under the title ‘’Translating Infrastructural gains into Economic Growth’’ quoted the Global Competitiveness Index for 2015 which states that inadequate infrastructure is the largest impediment to doing business in Nigeria.
He stated that about 70% of the 193,000km of roads in the country are in poor condition with the AfDB infrastructure Action Plan estimating US$2.9 billion is needed annually for routine and periodic maintenance.
According to him, the AfDB has set up a number of initiatives to help develop PPP in Nigeria the formulation of policy advisory and legal framework within various levels of Government. The most prominent being the African Legal Support Facility (ALSF)
The challenge which Nigeria’s infrastructure deficit poses was examined by an array of speakers and panelists in three sessions from 9am to 2pm.
The keynote addresses were presented by Mr. Opuiyo Oforiokuma, MD/CEO of ARM-Harith Infrastructure Investment Ltd., who spoke on “Creating a conducive environment for successful PPP in Nigeria”; Mr. Patrick Mgbenwelu, Head of Debt Solutions at FBN Quest, who looked at “Attracting FDI and Fresh Funding into the Infrastructure Industry” and Dr. Ousmane Dore, Country Director for African Development Bank, who examined the impact of infrastructure under the title ‘’Translating Infrastructural gains into Economic Growth’’
The ALP Seminar series was conceived in 2012 by Akindelano Legal Practitioners as a forum for discourse about commercial, practical and legal issues facing Nigeria’s businesses as Nigeria seeks to navigate its way into a modern economy.
In the past it has examined the indigenous Oil and Gas industry and the reformation of the Power sector. This year’s seminar sought to involve delegates and panelists from the public sector as well as the private sector.
Active among the panelists were Mr. Emmanuel Onwodi, the Head of the Special Projects for the Infrastructure Concessionary and Regulatory Commission (ICRC) and delegates from the Federal Ministry for Justice, the Federal Ministry for Works and Industry as well as the Lagos State PPP office.
Other panelists were corporate professionals from the investment banking, advisory and Insurance industry including Mr. Dayo Alao Senior Project Manager for Nigerian Infrastructure Advisory Facility (Advisers to the Federal Government on Infrastructure); Rachel More Vice President Rand Merchant Bank; Olufunmi Amanwa LeadwayInsurance; Mr. Olusola Lawson Africa Infrastructure Investment Managers (AIIM) Oladale Ajayi-BembeAkindelano Legal Practitioners (ALP) and Mr. Adekalu Balogun PWC.
The presentation by Mr. Oforiokuma looked at PPP in the local context and in the global context. He pointed out that PPP is a global phenomenon, but that Nigeria must develop its own brand consistent with the economic realities of the country and its peculiar idiosyncrasies.
He cited the example of the US$876 million Azura-Edo project which required funding from local and international investors involving a World Bank partial Risk Guarantee and a Put-Call agreement with the Federal Ministry of Finance to cover termination scenarios.
Azura took four years to come to financial close.
However, he said it was an encouraging beacon which other infrastructure projects involving public and private companies must learn from.
He cited Energy, Transport and Telecoms as some of the strongest areas in Nigeria for PPP projects. Mr. Oforiokuma closed with comments about the recent China-Nigeria Trade deal and the likely impact on PPPs in Nigeria.
According to Mr. Patrick Mgbenwelu, the one thing which was common to infrastructure project finance and PPP projects, both in the local and global context, is that there will always be funding for a good project and that success of PPP projects is in the preparation.
