Ease of Doing Business: Edo’s Rising Profile

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Recently, a top delegation from the World Bank visited Nigeria for an impact assessment of some development programmes and projects initiated and funded by the Bank in the country. Abimbola Akosile captures the highlights of the delegation’s visit to Edo State

When news came that a World Bank delegation was coming to Nigeria and that they would make stops in Lagos and Edo States, not many thought that the visit would be as far-reaching as it turned out.

The Bretton Woods institution, through various programmes and initiatives, has contributed to the Nigerian story, helping to design and build new cities, extending credit lines to support development and providing technical expertise for institutional reforms across different sectors of the economy, including agriculture, health, education, and environmental programmes and initiatives across the country.

Executive Visit

During the recent visit of the World Bank to Nigeria, ten senior executives of the Bank, drawn from different parts of the world visited selected states for an impact assessment of its various projects in the country.

The executives came to review the progress on their development support and financing projects across the country, with spotlights on Lagos and Edo States, where they have particularly extended budget support financing.

Edo State, in particular, was key because of the relative openness of the government and efforts to reposition the state for investment, which ultimately led to the timely execution of the Azura-Edo Power Project, among others.

August Visitors

It was against this backdrop that officials of state governments and the Federal Ministry of Finance waited in anticipation for the visitors.

The visit was described as unprecedented as it showed renewed interest in the Nigerian economy after the country’s exit from recession. In Edo State, there was remarkable synergy between the state government and the heads of the various World Bank-backed projects in the state, to coordinate and harmonise the details of progress made in driving sustainable development in rural and semi-urban communities.

The delegation of 10 Executive Directors was considered to be large, as they were expected to assess the performance of the states on key development indicators, and review activities to determine the feasibility of extending support to projects.

Expert Inputs

Experts have argued that Lagos and Edo states were selected because they performed satisfactorily well in the World Bank’s projects over time.

“The stop at Abuja is for administrative reasons and will be to meet with top officials at the Presidency and the Ministry of Finance. But the visits to Lagos and Edo states were for first-hand review of their support towards strengthening institutions and infrastructures in the states,” one of them posited.

“It is the first time since I have been monitoring the activities of the World Bank that 10 Executive Directors will be embarking on such a visit. There must be a couple of things that Edo and Lagos states are doing to deserve such a visit, shortly after the bank’s annual Spring Meetings,” they added.

On why the visit to Edo was imperative for the team, the experts said, “Lagos has a huge war-chest and is a darling to lenders, so the interest there is quite expected. But for Edo, it is said that they have recorded impressive milestones and have been scored really high by in-country teams. So, I am sure that the August visitors will want to go and see that for themselves.”

On the scope of the assessment, an official in one of the states said, “In some of the states, the focus will gravitate towards social development, agriculture, among others in rural areas. This includes the Nigeria Erosion and Watershed Management Project (NEWMAP), Community and Social Development Programme (CSDP), FADAMA development project, among others.”

Financing Impact

When the World Bank team arrived Edo State, they visited the globally-acclaimed Azura-Edo Power Project, which the Bank was instrumental in bringing to fruition by facilitating multilateral funding for the project.

After conducting the team round the plant facility, Edo State Governor, Mr. Godwin Obaseki, said the completion of the 450MW Azura-Edo Power Project was a demonstration of what can be achieved through development financing in the state.

He noted that with the plant now on stream, the state was looking at attracting more investors for the Benin Industrial Park and technology innovation hubs, which would benefit from the conducive business environment and guaranteed power in the state.

According to the governor, “Power is the key to industrialisation and development. We need to extend the benefits of this investment. Now that we have power, what are we going to do with it? The next sets of projects are those that have to rely on this key infrastructure we have just created.

“So, we would be looking at the Benin Industrial Park, building infrastructure to encourage and support manufacturers to come in. We are looking at innovation hubs; we want to use the factor and advantage of 24/7 electricity to encourage technology groups and companies to be located in Edo State.”

Noting that other social amenities would benefit from the power project and World Bank’s continued support to the state, Obaseki said, “We are looking at our educational system. We are looking at getting the power to our schools so that we can increase the standard and quality of our education. We have finished the design of a couple of other projects. We want to get partners like the ones who have developed this project, to work with.”

On opening up the state for investment, he said, “Our role as a government is to enable things happen. Edo State government will not put taxpayers’ money in projects that the private sector can handle. As a government, we will create the enabling and supportive environment to ease doing business in a place like Edo. We want to attract more private sector investors, who will bring their money and in that process create jobs and help us improve our economic wellbeing.”

Delegation’s Feedback

World Bank Executive Director, Angola, Nigeria and South Africa sub-group, Ms. Bongi Kunene, who spoke on behalf of the delegation, said the institution was ready to partner the state as long as projects are in line with the Bank’s focus, noting that the Edo-Azura power project is an example of a solution to a key problem in the country.

According to her, “The project is transformational. It gives us a scope of what we can do together. We are delighted to see solutions. We would want to commit ourselves to projects that make sense and are in line with our focus.”

On how more of such projects can be executed, she said, “First of all, approvals happen at the government level. It starts with land, and making sure that the area is zoned properly, and that the environmental impact assessment has been done and they are up to world standards.

“Something like this is not financed by one entity or one country. It is financed by multilateral arrangements as well as international investment banks. So, the government’s role is to make sure that all the standards are up to world standards and timelines are met.”

 

Power Boost

Managing Director and Co-Founder, Azura Power West Africa Limited, Dr. David Ladipo, said the project is a huge contribution to the power sector, explaining that the plant was instrumental to stabilising the national grid.

According to him, “In the evenings, our turbines are doing typically 450, 460 megawatts, which means we are producing 10, 11 or sometimes 12 percent of all the power that goes across the national grid. That gives me, the entire management team and the shareholders, including the Edo State Government, a tremendous amount of pride and satisfaction. We want to ensure that we continue to produce this power and, in another week or two, we will start planning for phase II.”

Edo Model

Following justification of the state’s execution of projects and other reforms, it was expected that the team would be willing to commit to more projects.

This possibility came up when the visiting team was hosted to a lunch at the Government House, where Governor Obaseki gave the delegation empirical evidence of the impact of their funding across poor communities in the state.

At the end of the presentation, the World Bank team affirmed that Edo State has become a model for development financing at the sub-national level in developing countries. Kunene revealed that the Bretton Woods institution was impressed with the level of work done through its various projects as well as the partnership that birthed the Edo-Azura Power Project.

Noting that the state was among the two sub-national governments that accessed its budget support instruments, she said the projects executed in the state were impressive and met the expectations of the visiting delegation. She added that the World Bank was willing to “partner the state on future projects, as long as the projects are in line with the Bank’s focus.”

Attracting Investment

Much of the success recorded in attracting investment in the state can be traced to the ease of doing business reforms in the state, anchored on the Governor’s insistence on transparency, accountable and respect for the rule of law.

This resulted in the enactment of a law banning the activities of Community Development Associations (CDAs), setting up of a Private Property Development task force, and ratifying of the Edo Development and Property Agency (EDPA).

All of these are to add to the creation of the Investment Promotion Office in the state, which is charged with interfacing with investors and opening up the state to genuine and trustworthy investors, who are guarantee of a stable investment climate and support of the state government.

The setting up of the Edo Geographic Information Service Agency to develop and manage a land bank for the state has also ensured that investors get their property documents in due time and are not stifled by activities of land grabbers and other miscreants.