Project Case Study
Accelerating the delivery of new infrastructure projects in Nigeria
Promoting public-private partnerships as a financing option for Nigerian infrastructure development
Financing Nigeria’s infrastructure gap presents a formidable challenge. The World Bank estimates it will require approximately US$110bn, approximately $20bn for power, $16bn for rail, $14bn for roads, and $60bn for oil and gas. Even considering this optimistically, Nigeria will not have adequate resources and public savings to meet these needs. However, channelling private capital through public-private partnerships (PPPs) can help to bridge this shortfall, as well as improving project delivery and operation by applying private sector discipline.
Funded by the Department for International Development (DFID) since 2007, we have moved quickly to shore up declining confidence in Nigerian PPPs. To do this, we have concentrated on easing the most significant constraints, such as co-ordinating PPP policy across government agencies, developing a bankable project pipeline and reaching financial closure on a handful of landmark transactions to build broad investor support.
Our solution has been to provide project specific support to two federal agencies (the Ministry of Works and the Ministry of Water Resources), embed advisors into the Lagos State PPP office, offer start-up and project support to the Nigerian Sovereign Investment Authority and assistance to the Federal Ministry of Finance on PPP policy co-ordination.
The results of our intervention have been significant and were recognised in 2010 when we won the African Investor PPP Champion of the Year Award. In Lagos, for example, our advisors have helped the government develop over $3bn of infrastructure projects. In Abuja, work is currently in place to attract $1.2bn of investment to the light rail system. More importantly, we have been able to introduce procedures to better plan and prepare solicitations for investor interest, and more broadly, to re-establish credibility for Nigerian PPPs.
These efforts are making it possible to attract investment in infrastructure, and therefore to generate a better economic climate for international and local businesses, and individual Nigerians.
NIAF won the British Expertise Development Project of the Year Award in 2011.
“The dedicated Lagos support has proved invaluable in the last couple of months with the PPP Director Recruitment process and ongoing assistance with establishing the PPP unit."
His Excellency Babatunde Fashola (SAN), Lagos State Governor
