By Tony Obiechina, Abuja
Council members of the Nigerian Institute of Transport Technology (NITT) Zaria have called for sustainable funding solutions to transport infrastructure development in Nigeria in view of its importance to the socio-economic development of any nation.
According to them, transport is an important element of the economy and critical instrument necessary for development of other sectors.
Speaking at a national conference on Sustainable Transportation Development Infrastructure Financing in Nigeria, the council represented by the Chairman Olorogun John Onojeharho and Director-General/Chief Executive, Dr Bayero Salih-Farah described transportation as the “veins and arteries” of the economy and remains the fulcrum of development in any nation, stressing that “an efficient transportation system reduces costs in numerous economic sectors, but lack of it increases the costs of production and services”.
According to the DG/CE, “Looking at the Nigerian scenario, Logistics and Transportation contributes below 5% of the GDP, it is therefore, not out of place to say that the transport sector in Nigeria is not contributing enough to the economic development and growth as well as the Gross Domestic Product of the Country, due largely to inadequacy of the transport infrastructure compared to what obtains in countries like Brazil, Singapore and Turkey where transportation is contributing significantly to the economy and GDP of these countries.
“Less not forget that Nigeria is endowed with 923,768 Km-sq land size with a population of over 211 million, majority of whom are young and energetic and a coastline of 853km.
“Transport infrastructure financing in Europe and America has traditionally been from general public funds, with the main sources coming from taxation and levies. But current trends have indicated a massive shift from the old practice allowing for private participation in funding transport infrastructure development projects.
“However, with the current concerted efforts of the present administration towards providing and revamping existing transportation infrastructure and the expected private sector participation, things will change for the better in no distant future.
“It is noteworthy, that the current Government has invested a lot of resources in this direction. Particularly in the construction of new rail ways and bridges, rehabilitation and construction of highways, modernisation of air ports and development of deep seaports.
“However, the over two hundred million Nigerians across the length and breadth of the Country are yearning for more transport infrastructure development to ease their movements and promote their living conditions and businesses.
“Definitely, Government resources are limited, particularly bearing in mind other competing demands for resources in sectors like Health, Agriculture, Education and National Security”.
He said it was against this backdrop that the Nigerian Institute of Transport Technology considered it timely, to organize the 2-day conference on Sustainable Transportation Infrastructure Development Financing in Nigeria, with the sole aim of finding sustainable funding alternatives for the development of transport infrastructure in Nigeria.
The NITT therefore urged the participants to extensively deliberate on the subject matter and come-up with workable funding solutions that would meet the peculiar needs of sustainable transport infrastructure development in Nigeria and promote an efficient transportation system for the country to pave way for the desired level of economic growth and development.
Also speaking, Chairman of the NITT governing Council Olorogun John Onojeharho said the conference was aimed at bringing stakeholders together to brainstorm and suggest ways of improving sources of financing transport infrastructure development and maintenance in Nigeria towards enhancing accessibility capacities of Nigerians.
He decried the current traditional funding mechanism of transport infrastructure through annual budgetary allocation, grants and loans which he said are unsustainable and difficult to match up with rapid decaying of infrastructure in the country due to pressure from population and economic growths. Even at the state levels, many states are yet to exploit funding alternatives to supplement existing method, the chairman said.
“Transport infrastructure provision and maintenance is highly capital intensive and seems to be beyond the financial power of government. Precisely, it is very difficult for government alone to provide the needed capital because of the huge financial requirement which the annual budgetary provision is too meager to take care off. There is thus the need for better funding options that is stable and consistent for transport development and maintenance in the country”.
“Right now, Federal, States and Local Governments in Nigeria still remain the sole financiers of transport infrastructure developments in the country. However, given the current economic realities, where the government sources of funding are being threatened by unstable oil revenues and the myriads of other challenges, there is the need to address the nation’s problem of funding transport infrastructure development head on”, the chairman said.
He expressed the optimism that resolutions from the conference if effectively implemented would lead to better and sustainable development of transportation infrastructure in Nigeria. Other speakers at the conference stressed the need for a sustainable funding for the transportation sector bearing in mind its critical importance to national economic and social development.
In his key note address Transportation Minister Rotimi Amaechi emphasised the need for sustainable funding mechanism to mitigate transportation infrastructure deficits in the country. According to the minister whose address was read by the Minister of state, Gbemisola Saraki, transportation as an enabler for economic development of other sectors requires long term capital investment by public and private institutions.
The Nigerian transport sector accounts for 74% of Public-Private Partnership (PPP) amounting to $27 billion funded projects in the country with an investment gap of about $113 billion. While road transport accounts for 87-95% of all freight and passenger movement, and incurred 61% of annual average transport infrastructure spending in Nigeria, the figure has been insufficient for a sector serving as a strategic economic tool for Nigeria’s economic growth and prosperity.
In a recent report, the World Bank had observed that Nigeria requires about $14.2 billion annually to fund its infrastructure development deficit.
About 313 participants (180 physical and 133 virtual) attended the conference from across the country. In attendance were the Ministers of Transportation Rotimi Amaechi, and ( Transportation, State) Gbemisola Saraki ; Finance, Budget and National Planning, Zainab Ahmed; and her Works & Housing counterpart, Babatunde Fashola.
Others include, representatives of the World Bank, European Union (EU), and professional bodies such as Chartered Institute of Logistics & Transport, Chartered Institute of Transport Administration, as well as representatives of the Governors of Lagos, Kaduna, Adamawa and Ondo States, State Commissioners of Transport, Works and Finance, FRSC, Traffic Management Agencies, Academicians, Regulatory Agencies, Transport Unions, Transport Professionals, Investors, Journalists, and other stakeholders.
Others who presented were the Managing Director, The Infrastructure Bank Plc Ross Oloyede; Ag. DG/CE of ICRC Mike Ohkani; DG/CE Debt Management Office, Patience Oniha; and MD/CE, Eco Bank PLC Patrick Akinwutan, and Prof. Bamidele Badejo, a transportation management expert.
