- Government Seeking $3bn Loan To Fix Infrastructure- Adeniyi Adebayo
The continued closure of Nigerian land borders will not solve the problem of smuggling and insecurity in Nigeria, the Lagos Chamber of Commerce and Industry, LCCI has warned.
Mrs. Toki Mabogunje, The President of the Chamber, made this known during the 2020 LCCI Presidential Policy Dialogue Webinar, tagged, Benefits, and Challenges of Investing and Doing Business in Nigeria.
She posited that the closure of the borders so far has had a devastating effect on transborder trade, adding that in the light of Nigeria’s signing of the African Continental Free Trade Area agreement, there was a need to brace for the kind of competition that comes from such continental economic integration agenda.
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“Closure of the land borders has had an enormous impact on cross-border economic activities. Indications are now that closure is indefinite.
While we share the concerns of the government on issues of security and smuggling, we believe that the indefinite closure of the land borders is not the solution to the problem.
We are excited about the signing of the African Continental Free Trade Agreement, AFCfTA but we need to prepare ourselves for the competition that is inherent in such continental economic integration agenda” she said.
She noted that a number of commitments were made with regards to the creation of an environment that will enable the private sector to be more competitive, the LCCI president expressed concerns that not much had happened to the actualization of the commitments.
‘Even though the government had made efforts to improve infrastructure in the nation, funding had remained a major constraint to infrastructure upgrade’ she noted.
She recommended a partnership with the private sector in attracting capital, saying, “At a time like this, we should do what we can to attract private capital for the domestic economy.
“Challenges of funding in the economy is critical and it needs to be tackled as the ease of doing business remains an issue in the country.”
Explaining further, she said the key cost drivers for the private sector were high energy cost, depreciating rate of the naira, high cost of funds, and high cost of transacting business at the ports, among others.
“There is a limit to which these costs can be passed to the consumer, especially in an environment with weak purchasing power,” she added.
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Reacting, the Minister of Industry, Trade and Investment, Otunba Adeniyi Adebayo, said the government was doing all it could to fix infrastructure deficit in the country.
He maintained that the amount budgeted for infrastructure was far off the mark, adding that Nigeria needed about $3tn to completely upscale its national infrastructure over the next 30 years.
“According to the Nigerian Infrastructure Masterplan, Nigeria requires an estimated sum of $3tn to upscale its national infrastructure over the next 30 years. This breaks down to an average of $100bn annually” he said.
According to him, part of the steps to resolve the challenge of energy includes the negotiations with Siemens AG to revitalize the power sector as well as expand the generation and supply capacity from 11,000 megawatts to 25,000 megawatts by 2025.
“Also, the Federal Government is concluding plans to secure a $3bn loan from the World Bank to bridge the gap between what is provided for in the current tariff, and the cost to businesses,” he added.
