Is Nigeria's infrastructure spending plan feasible?

Nigeria's infrastructure has long been identified as the key to unlocking the country's growth potential. The government has laid out plans to allocate 30% of the 2017 budget towards infrastructure projects, totaling about $25 billion annually to address the existing deficit. However, challenges remain in the feasibility of this ambitious plan. Anthony Eke, Divisional Head of Infrastructure and Transport at Diamond Bank, shares insights on the current state of Nigeria's infrastructure and offers suggestions for bridging the funding gap. Eke acknowledges the critical nature of the infrastructure deficit, stating that the budget allocation over the past three years is a step in the right direction. He emphasizes the need for approximately $2 trillion over the next three decades to fully address Nigeria's infrastructure needs. The recent decline in revenue, attributed to falling oil exports, poses a significant challenge in funding infrastructure projects. While the government has made efforts to channel funds towards infrastructure development, Eke highlights the limitations posed by budget constraints. With a current deficit of $2.4 trillion, a combination of local and foreign debts is required to bridge the gap. Eke notes the potential impact of increasing infrastructure spending on other sectors, such as job losses, underscoring the delicate balance in addressing infrastructure needs without destabilizing the economy. In exploring creative solutions to the infrastructure funding gap, Eke suggests greater collaboration between the government and the private sector. He advocates for stable policies and confidence-building measures to attract private investments. Eke points to initiatives like the infra credit fund of $2.8 million and bond offerings as mechanisms to leverage private sector funding for infrastructure projects. By engaging with state governments and offering incentives like tax relief, Eke believes the government can stimulate private sector participation in infrastructure development. The conversation also delves into the issue of project failures in Nigeria. Eke attributes project failures to a lack of sincerity of purpose, noting challenges in execution and continuity across government administrations. The absence of a consistent approach to infrastructure development hampers progress and perpetuates a cycle of inefficiency. Eke advocates for a long-term strategy that transcends political cycles and ensures sustained infrastructure development. In conclusion, Nigeria faces formidable challenges in addressing its infrastructure deficit, requiring innovative approaches and sustained commitment from both the public and private sectors. Eke's insights shed light on the complexities of infrastructure funding and the imperative for strategic, long-term planning to unlock Nigeria's growth potential.