BPE Generates N550bn from Privatisation, Attracts $7.8bn FDI


• To privatise Afam power plant, reconcession Lagos Trade Fair complex, commercialises six river basins, others

Ndubuisi Francis and Chineme Okafor in Abuja

The Bureau of Public Enterprises (BPE) generated a total of N550 billion through the privatisation of public enterprises in the past 30 years.

A total of 142 companies and agencies of government cutting across various sectors of the economy were either privatised, commercialised or concessioned during the period.

The privatisation agency also attracted $7.8 billion into the country in foreign direct investment (FDI) from 53 enterprises in the past 18 years.

Briefing journalists in Abuja Thursday on the privatisation journey from the Technical Committee on Privatisation and Commercialisation (TCPC) in 1988 through to emergence of the BPE 18 years ago, the Director-General, Mr. Alex Okoh, said the N550 billion represented only accruals from privatised enterprises, adding that some of the 142 companies and agencies which were either commercialised or concessioned did not fetch any income.

“From 1999 till date, the BPE has successfully reformed (by way of privatisation, commercialisation and in some cases concessioned) a total of 142 public enterprise, he said, stressing that strategies adopted included core investor sale, guided liquidation, sale to existing shareholders and public offer.

Others are liquidation, private placement, concession, debt/equity swap, and sales of assets.
He said between 30 and 36 per cent of sold enterprises were not doing well, adding that this was established through an in-built post-privatisation monitoring mechanism of the agency.

Okoh stressed that the poor performance of such enterprise post-sale arose from macroeconomic issues as well as fiscal issues, among others, adding that BPE was trying to address such encumbrances.

Okoh said the activities of BPE were designed to primarily diversify the economy and strengthen the private sector as the country’s engine of growth and economic driver.

He added that it also assists in restructuring the public sector in a manner that would effect a new synergy between a leaner and more efficient government and a revitalised, efficient and service-oriented private sector.

According to him, through its privatisation and commercialisation programmes, the BPE attained some broad milestones in the past 18 years, including expanding private sector participation in the Nigerian economy and attracting quality foreign investors and capital.

The BPE chief executive said a total of $7.8 billion was attracted into the Nigerian economy by way of FDI through 53 sold enterprise in the past 18 years.

He noted that the BPE had also been able to achieve a more efficient allocation of government resources by redirecting funding of public enterprises by government to other key sectors of the economy that are socially imperative.

Okoh disclosed that the Afam Power Plant with a 976 installed capacity and the Yola Distribution Company are slated for privatisation and re-privatisation respectively, this year.

It is also to concession Terminal ‘B’ of the Warri Old Port, partially commercialise select parks in the country as well as the commercialisation of six River Basin development Authorities.

The Lagos International Trade fair Complex, he disclosed, would also be reconcessioned, adding that the BPE is already in the process of appointing a new concessionaire.

He said there was no reason why such a massive asset should be allowed to remain in a dilapidated state.
Okoh stated that the BPE was expected to contribute N400 billion from the privatisation proceeds to the 2018 Budget.

He argued that there was no sense in retaining dormant public assets and continue to give them subventions while the government at the same time continues to borrow money to finance the budget at very high cost.
The BPE boss regretted that the major obstacles to the sale of such assets were the ministries, departments and agencies (MDAs) as well as organised labour.

He argued that the MDAs’ reluctance and sentimental attachment to such assets were not doing the country any good.
But he also noted that the BPE was engaging various stakeholders, stressing that organised labour is a major stakeholder in privatisation matters.

Okoh also disclosed that the BPE would be actively involved in the power sector recovery initiative, adding that it was instrumental to the reforms that took place in the sector.

He noted that about N320 billion as severance package to workers in affected by the power sector reforms.
Okoh, who also reacted to certain developments involving the Infrastructure Concession Regulatory Commission (ICRC), admonished the agency to restrict itself to its statutory role of a regulator, adding that it cannot be an umpire and a player at the same time.

According to him, playing ambivalent roles could send wrong and confusing signals to investors.