How N14.37bn NEPZA diverted funds stall development at Calabar, Kano free trade zones

THE development of basic infrastructure at the Calabar and Kano government-owned Free trade Zones (FTZs) continue to be a challenge for the Nigerian Export Processing Zones Authority (NEPZA), while over N14.37 billion of its budget funds has been lying dormant at the Central Bank of Nigeria (CBN) for over three years. 

In 2019, the former Acting Managing Director of NEPZA, Terhemba Nongo revealed that the government needed over N15 billion to bring about 15 million megawatts of electricity to Calabar and Kano FTZs in order to propel the industrial cities to become fully operational. 

He lamented that infrastructural deficiency had hindered the trade zones in the country from becoming industrial base centres. 

Nongo told newsmen in Abuja that Nigerian free trade zones lacked basic infrastructure that could bring development and attract investment into the industrial cities. 

“About N4 billion to N5 billion is needed for the power project in Calabar free trade zone and over N10 billion for the project in Kano trade zone,” he said, noting that power was one of the basic infrastructures whose unavailability had hindered the full industrialisation of the trade zones. 

“Each of the industrial zones we have will be able to create 50,000 direct jobs; divide it by the number of free zones we have in this country and see the numbers,” he further said. 

He, however, regretted that the opportunities created by the present industrial centres were lying dormant because the trade zones were not fully functional due to lack of basic infrastructure like power, water and access roads.

Nongo said funding had remained a huge challenge to the regulatory body and the managers of government owned industrial centres, the Calabar and Kano Free Trade zones. 

In 2017, President Muhammadu Buhari increased the budget of NEPZA to N50 billion for the purpose of improving infrastructure in these trade centres as a means of building an industrial base and subsequently improving on the country’s export capacity. 

First to be established as a government-owned free trade centre was the Calabar free trade zone which came on stream in 1992. However, work did not commence at the zone for10 years. In 1994, Kano free trade zone was established but funding to build infrastructure became an impediment to the take-off of the industrial base. 

When the Buhari administration increased the budget of NEPZA in 2017, commendations came from many quarters with many stakeholders expressing confidence that infrastructural development for the government-owned trade zone was underway. 

However, soon thereafter, the former Ministry of Industry, Trade and investment and the agency in charge of development, regulation and supervision of trade zones, NEPZA was engulfed in a controversy over the transfer of N14.37 billion NEPZA funds to a private company, Nigerian Special Economic Zones Company (NSEZCO).

 In delivering the proposed infrastructural development as appeared in NEPZA budget, former Minister of Industry, Trade and Investment, Dr Okechukwu Enelamah handed down powers of execution to NSEZCO. 

The development was met with fierce opposition from stakeholders particularly the Association of Senior Civil servants of Nigeria (ASCSN). 

In 2019, ASCSN wrote the President and the National Assembly seeking thorough investigation into the emergence of NSEZCO and seeking the removal of the current Minister of Industry, Trade and Investment, Niyi Adebayo, who had previously announced that efforts were being made by the ministry to resolve the controversy surrounding the N14.37 billion so that the money will be put into proper use. 

“The other day, we were at the Senate, we are making efforts to ensure that the issue is resolved,” the Minister stated. 

He said plans were at an advanced stage to review the Nigerian industrial Revolution Plan (NIRP) in order to create a better method of administering industrial development to the country. 

The immediate past Acting Managing Director of NEPZA, Mr Bitrus Dawuk revealed that a committee was set up on December 23, 2019 to review issues surrounding the transfer of the N14.37 billion to NSEZCO currently domiciled at the CBN.

Dawuk stated that the agency was working with the ministry to resolve issues surrounding NSEZCO and possible clashes over functions with NEPZA. He emphasised that for the country to witness rapid development at the FTZs, the Act establishing NEPZA must be amended. 

“If I can get the Bill seeking to review NEPZA Act amended, if I can get that achieved within my time, I will be very happy,” he said. 

The Acting Managing Director said the amendment would help to promote business at the trade zones in Nigeria, saying: “If the Act is amended, it will make NEPZA self-sufficient in terms of funding and it will also help promote investment in the manufacturing sector.” 

Although the current Managing Director of NEPZA, Professor Adesoji Adesugba said little about the Authority’s money trapped at the CBN, the improved budget of NEPZA under the current administration has enabled him to push for further development at the trade centres. 

A top official of NEPZA who spoke to the Nigerian Tribune under the condition of anonymity said the agency was not sure when the issue would be resolved and whether the N14.37 billion would be returned to the agency. 

For now, the money is lying dormant at the CBN, while projects like electricity, road and water struggle for lack of funds.