FG moves to address administrative obstacles in highway development

The Federal Government has opened up discussions with concessionaires of some major highways in the country who are ready to invest about ₦1.5 trillion in the sector but are holding back due to some administrative obstacles yet to be sorted out.

Leading the Federal Government’s team, the Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, in company of the Minister of Budget and Economic Planning, Mr. Abubakar Atiku Bagudu, and the Director General Infrastructure Concession and Regulatory Commission (ICRC), Dr Jobson Oseodion Ewalefoh held a meeting on Wednesday with some of the private sector investors in Abuja.

The Minister of Works, Engineer Dave Umahi who joined the meeting virtually tried to reassure the private sector partners on the highway development and management initiative of the Federal Government that everything possible would be done to resolve the contending issues.

One of the concessionaires, Mr. Kola Kareem who stood in for Shoreline requested the right documentation that is enforceable, stipulating the takeoff and handover dates, which would attract investors to bring in their funds.

The private sector partners also requested for the addendum to the original agreement to be signed that would enable toll sections of the completed highways while work progresses on other sections.

They admitted that each concessionaire has unique challenges that should be dealt with accordingly.

Issues raised at the meeting did not get final resolution as the Minister of Finance and Coordinating Minister of the Economy rescheduled the meeting for another date when all parties involved would be present, including the Minister of Works.

Edun reassured the concessionaires of quick resolution of the issues raised to enable mobilise to sites.

Some of the road projects include Lagos-Badagry-Seme Border, Shagamu-Benin, Lagos-Abeokuta, Abuja-Lokoja, Enugu/Port Harcourt/Owerri/Aba, Potiskum/Damaturu/Kano/Zaria highways.

Edun said, “We met the concessionaires who have virtually concluded all the agreement arrangements for nine major highways, which they are contracted to refinance the rebuilding of and to recover their funds from tolling fees under 25 years or so agreements. And we met them to iron out the remaining administrative obstacles to them kicking off construction of these roads. And it is roughly 900 kilometers of road with a value of about ₦1.5 trillion.

“So it’s a substantial investment by the private sector, bridging budgetary gaps and handing over to private sector investors, revenue-generating transactions which they have the expertise, they have the resources and they can implement and maintain over a long period. And that essentially is the determination, the commitment, the strategy and the policy of this administration to stabilize the economy, to allow private sector to come in and take revenue-generating opportunities, make investments that improve productivity of the economy, grow the economy, create jobs, and reduce poverty.

“So a major step was taken today. The Minister of Works was part of the conversation even though he is actually in Lagos taking investors around and showing them the progress so far on the legacy Lagos-Calabar Highway. He still joined in the conversation and really we are talking as I said about over ₦1.5 trillion Naira worth of investments by the private sector just requiring finalization of some adjustments that had to be made to the original agreements because of the passage of time”.

Answering questions on the timeline for these investors to begin to see the fruition of this meeting, Edun responded that the Federal Government team had a very good discussion, though the Minister of Works wasn’t around, he would be around when they hope to finalise the contending issues by Tuesday.

Edun added, “Thereafter, there will be a question of signing the addendums and moving to site. As you know, already the 125-kilometer Benin to Asaba Highway concession agreement has been signed. The addendum has been signed. All arrangements have been finalised. In fact, the Ministry of Works has handed over the road to the concessionaire and they have already started the preliminary arrangements for reconstruction of that road, a 10-lane highway. It’s an investment, project, and an initiative that will reduce the travel time between Benin and Asaba right up to the Niger Bridge.

“It will reduce the time for goods and people from 4 hours to 1 hour. You can see the increase in productivity and as I said, it is private sector driven. They have all the money in place and so with the example of Benin and Asaba having kicked off, the other concessionaires are in a hurry to complete their own administrative arrangements and start their own projects to the benefit of the Nigerian economy”.

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