Finance minster Mrs Kemi Adeosun
Finance minster Mrs Kemi Adeosun

Minister of Finance, Mrs
Kemi Adeosun, said the Federal
Government would make the
Public-Private Partnerships work
in spite of its challenges, to bridge
the wide infrastructure deficit in the
country.
Adeosun said this on Tuesday
in Abuja at the 10th Africa Finance
Corporation Summit, aimed at
charting a way for infrastructure
financing in Africa.
The World Bank estimates that
there is a global investment gap of
one trillion dollars annually.
Nigeria’s infrastructure deficit
is put at 300 billion dollars,
representing 25 per cent of the
nation’s Gross Domestic Product.
“When we came to office, 90 per
cent of the budget was on recurrent
and 10 per cent on capital spending.
“So first thing we had to do was
ensure that government spends at
least 30 per cent of its budget on
capital. We released N1.2 trillion in
the last 12 months on capital.
“We recognise that government
on its own cannot address the
country’s infrastructure deficits
even if we devote all of our budget
to infrastructure for the next 10
years, we can’t bridge the gap.
“I want to assure you that
government will continue to be a
provider of infrastructure but we
must crowd in additional funding.
“PPP has a history in Nigeria but
this government has taken it that
there is no alternative; we must
make PPP work.
“We have to look at the existing
PPP projects, figure out what went
wrong and fix the ones that are
fixable and create the framework
that encourages investors to come
in,” she said.
She said that the government
was counting on international
players such as the African Finance
Corporation to help showcase
some of the opportunities in the
private investors and international
development players could take
advantage of.
Adeosun said it was not enough
that investors currently had a huge
appetite for African infrastructure
risk at the Eurobond market and
other markets.
She drew attention of investors
to opportunities in power, tollable
roads, housing, education
and manufacturing sectors of the
economy.
Also, the Governor, Central
Bank of Nigeria, spoke on dollar
denominated investment, which
created risk for African countries
especially Nigeria.
“At a time when we are facing
commodity shocks, you will find
that taking foreign denomination
facility to finance obligations
domestically creates a kind of
credit risk, particularly if expected
revenues are domestically
denominated.
“You’ll find that if there are shocks,
naturally you will find weaknesses
in the ability of the obligor to be able
to repay the facility.
“So that means that in a changing
world like we are right now, there
is need for us to think about how
we can structure domestically
denominated facilities where
currency shocks do not impact
repayment and performance of
these facilities,” he said.
Emefiele said that to mitigate
against the shocks, some
development finance institutions
like the AFC raised Naira bond and
facilities and deployed them into
infrastructure project.
He said that the CBN would
continue to support options
that reduced the risk of foreign
denominated investment in the
country.
Meanwhile, the Minister of Trade
for The Gambia, Dr Isatou Touray,
said the country was open to
private investments, after 21 years
of dictatorship, particularly in the
area of power.
She said the country needed 200
mega watts of electricity and was
currently generating 80 megawatts
but could only use 40.
NAN

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