Drawing attention to Nigeria widely recognised lackadaisical approach, the World Bank has redirected its focus towards the nation’s substantial deficit in infrastructure. In his statement at the 2023 banking and finance conference in Abuja, the World Bank’s Country Director for Nigeria, Shubham Chaudhuri, expressed his profound concern regarding the paucity of public expenditure by the Nigerian government, encompassing both the federal and sub-national level. Thus, it is imperative that the leadership across the three tiers of government undertake a proactive effort to propel the nation to a level of economic prosperity by tackling the prevailing deficit.
Despite having been an independent nation for 63 years, developmental progress has been poor. Many projects have been abandoned. Public refineries have been inoperable for decades. Transport networks such as railways, roads, airports, and seaports are woefully inadequate. Electricity supply is also inadequate. Both the federal and state administrations recklessly prioritize recurrent expenses over long-term investments. Nigeria infrastructure deficit is estimated to cost between $100 billion and $150 billion each year over the next 30 years, according to experts. While Agusto & Co. and the World Bank put the figure at $3 trillion, Dataphyte puts it at $2.3 trillion.
It will take 300 yrs to close the gap at the present financing rate.
In 2020, out of 54 African countries, Nigeria was positioned 24th with a score of 23.26 on the Africa Infrastructure Development Index (AIDI). In contrast, Egypt ranked second with a score of 88.3 and war-torn Libya ranked third with a score of 82.9. According to Chaudhuri, Nigeria would need 300 years at the current financing rate to close the gap. The N8.33 trillion allocated to ongoing expenses in the government budget for 2023 is almost 40 percent of the entire budget. In terms of infrastructure quality, the Global Competitive Index Report 2019 placed Nigeria at number 130 out of the 141 economies surveyed.
Just a few significant initiatives have been executed since the start of the Fourth Republic. The National Stadium in Abuja, the Abuja-Kaduna Rail, the Lagos-Ibadan Rail, and the Ajaokuta-Itakpe rail line were among the few noteworthy projects that were carried out, as well as the recently completed Second Niger Bridge. Instructively, the reconstruction of the 127.5-kilometre Lagos-Ibadan Expressway, begun in 2004; the East-West Road, Sagamu-Benin Expressway, Ibadan-Ilorin, Benin-Auchi-Lokoja-Abuja Expressway, Abuja-Kaduna-Kano Expressway, and other vital arteries remain under perpetual reconstruction. Only 60% of Nigeria total road length (around 200,000 km) is paved.
Ensuring economic growth via infrastructure investment is essential.
Ten thousand nationwide projects have been identified as abandoned by the Senate. A far greater number of unfinished projects, 56,000, was cited by the Chartered Institute of Project Managers of Nigeria in 2022. Among these is the Ajaokuta Steel Corporation, which was launched in 1978. The Niger Delta Power Holding Company has a total of 12 megawatts of generation capacity, although only a fraction of those facilities are operating. There were apparently 138 failures in the sole national transmission grid over the past decade. Nigeria was placed 29th out of 54 African countries on the AIDI Electricity Index 2020.
The Nigerian president needs to implement changes for the to be able to meet the World Bank’s recommended infrastructure to GDP benchmark of 70%; at present, Nigeria is only at 30%. His cabinet of 45 ministers and MDA alongside their staff should be reduced to cut governing costs. This is due to the fact that keeping the legislature operational is now beyond the financial capacity of a country whose debt stands at N87.38 trillion. Experts recognise that ensuring economic growth and stability through investment in infrastructure is essential, thus the government should prioritize infrastructure development.
Revenue can be boosted through privatizing state-owned business.
Also, the Nigeria president should prioritize infrastructure spending beginning with the 2024 budget, providing more money to capital expenditure and less to recurrent. Government revenue can be boosted through measures such as privatizing state-owned businesses, downsizing the Presidential Air Fleet, limiting international trips, enacting the Revised National Integrated Infrastructure Master Plan, and putting airports and seaports up for concession. Similar efforts at improving infrastructure on the local level should also be made by state governments.