FG Gears Up for 12 Highways’ Concession

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Babatunde Raji Fashola

Eyes N1.1tn investments, 250,000 jobs

By Emmanuel Addeh

The federal government yesterday started the procurement process for the concession of 12 major roads under the Highway Development and Management Initiative (HDMI), covering all the six geopolitical zones of the country.

Minister of Works and Housing, Mr. Babatunde Fashola (SAN), stated at the ceremony in Abuja that the aggregate total of 1,963 kilometres, which is 5.6 per cent of the 35,000-kilometre federal road network, would be affected by the development.

He said the 12 roads were chosen to ensure the coverage of each of the six geo-political zones, adding that the initial capital investments would be about N1.134 trillion.

He listed the highways to include Benin-Asaba, Abuja-Lokoja, Kano-Katsina, Onitsha-Owerri, Sagamu-Benin, Abuja-Keffi-Akwanga and Kano-Maiduguri which fall into lot one.

The second lot comprises Potiskum-Damaturu, Lokoja-Benin, Enugu-Port Harcourt, Ilorin-Jebba, Lagos-Ota-Abeokuta and Lagos-Badagry federal highways.

According to him, the project could create 50,000 direct jobs and 200,000 indirect employments.

“Currently, the government is executing over 700 different contracts, which aggregate to the rehabilitation and reconstruction of over 13,000 km of roads and bridges across all the 36 states, including the Federal Capital Territory,” he stated.

Fashola added that due to the size of the roads in the country, there is an increasing and unsatisfied demand for funding to finance the projects to completion and to maintain them.

He explained that there’s also the need to finance other complementary services like weighbridges, rest houses, towing vehicles and road furniture, which seem better suited for the commercial initiative of the private sector.

“In the interim, the government is constrained to borrow, offer tax credit, and increase her revenue mobilisation capacities in order to sustain this massive infrastructure renaissance.

“This is the background to the HDMI, which is another effort to mobilise private capacity, resources and entrepreneurship into the Nigerian highway sector; and hopefully convert roads from just social assets into assets of commercial opportunities and enterprise,” the minister stated.

He explained that the HDMI is made up of two categories: Value-added Concessions (VAC) and the Unbundled Assets Approvals (UAA).

The UAA is expected to provide the opportunity for small businesses to take advantage of the commercial opportunities that are available along the Right of Way (RoW) while under the VAC, the road pavement and entire right of way is given out for development and management by the concessionaire.

Fashola stated that not only has the right of way of the 12 roads been fully gazetted, the Infrastructure Concession Regulatory Commission (ICRC), as a regulatory body for concessions of nature, has also issued the Certificate of Compliance for the Outline Business Case that is necessary to commence the process.

In order to ensure competitiveness and to guarantee transparency, the minister said a procurement portal had been developed to serve as the interface with the public and to manage the HDMI from procurement to implementation, to maintain the integrity of the process and to keep the playing field level.

He said the HDMI portal would open on March 29, 2021 and all transactions would be done through the portal.

Earlier, the Permanent Secretary in the ministry, Mr. Hussein Babangida, had said the programme was meant to leverage private sector investment to improve facilities and operations on the selected routes.

According to him, it will also help maximise the revenue-generating potential of the routes, reiterate the government’s role in infrastructural development as facilitator and enabler of investment; and ensure international best practices in the development and management of highways, amongst others.