•$3.38bn projects awaiting consensus before signing of loan agreements
•Issues N78bn tax credit to road investors
Ndubuisi Francis, Olawale Ajimotokan and Joel Ita in Abuja
The federal government yesterday disclosed that it executed 94.1 per cent of the 2021 budget in the areas of infrastructure and human capital development.
Minister of Finance, Budget and National Planning, Mrs Zainab Shamsuna Ahmed disclosed this in Abuja, during a town hall meeting on the achievements of the federal government in infrastructure development organised by the Ministry of Information and Culture.
She said from the expenditure side of the capital budget, as of November 2021, N12.56 trillion or 94.1 per cent had been spent out of the N13.57 trillion pro rata budget.
She noted that this performance was inclusive of expenditure estimates of the Government-owned Enterprises (GoEs), but exclusive of project-tied loans. She said infrastructure projects and programmes undertaken by the administration to create the enabling environment for socio-economic growth and development helped in placing the country on the path of growth.
Ahmed asserted that the administration has continued to prioritise spending on infrastructure and human capital to catalyse rapid economic development, adding in 2022 alone, it intends to spend about N1.42 trillion on infrastructure and N2.11 trillion on human capital development.
She explained that in the light of constrained revenue proceeds brought about by several multi-dimensional factors, including the global pandemic and its impact on the domestic economy, the ministry designed various initiatives to meet the needs of the people.
She also disclosed that a total of 11 capital projects worth about $3.387 billion are currently awaiting consensus before it signs loan agreements with the World Bank, the African Development Bank (AfDB) and French Development Bank, for their execution.
Furthermore, she revealed that the federal government had issued about N78 billion worth of tax credit to investors under the Road Infrastructure Development and Refurbishment Investment Tax Credit Scheme (RITCS) between 2019 and 2021.
She listed the projects awaiting consensus before the signing of loan agreements as the $673.2 million Kano Urban Light Rail Project (Phase I); construction of Lafia By-Pass road and the dualisation of 9th Mile (Enugu)-Otukpo-Makurdi Road Project ($845.75 million).
Others are the E-Border Solution ($175.5 million), the $350 million Nigeria Electrification Project (Off Grid), the $32.3 million North Core Interconnection Power Transmission Line (Regional Project under West African Power Pool) and the Nigeria Electricity Transmission and Access Project: ($486 million).
They also include the Nigeria Electrification Project ($200 million), Nigeria Transmission and Expansion Programme ($210 million), Abuja Power Feeding Transmission Scheme ($170 million), and the Northern Corridor Transmission Line ($245 million).
The minister listed some ongoing key infrastructure projects funded by external loans from the China EXIM Bank as
the Zungeru Hydropower Plant Project ($984.32 million); Lagos–Ibadan Railway Project ($1.26 billion); upgrading and rehabilitation of Keffi-Akwanga—Lafia road ($460.82 million).
Also listed are the supply of rolling stock and depot equipment for Abuja Light Rail Phase 1 Project ($164.91 million); the $328million NICTIB Phase II (Galaxy Backbone); Four Airports Terminal Expansion Project Phase II ($208.91 million), as well as ancillary works on four airports terminal expansion ($183.62 million).
The minister stated that her ministry, under the International Economics Relations Department (IERD) contracts external loans on behalf of the Federal Government of Nigeria from bilateral and multilateral development partners to finance critical infrastructure.
She explained: “It is important to note that these loans are contracted within the framework of the 2020-2023 Medium-Term Debt Management Strategy (MTDS).
The MTDS provides a guide to the borrowing activities of government in the medium-term, usually four (4) years.
“The MTDS has been prepared by the Debt Management Office (DMO), in collaboration with relevant stakeholders (Federal Ministry of Finance, Budget and National Planning, Central Bank of Nigeria, Budget Office of the Federation, National Bureau of Statistics and the Office of the Accountant-General of the Federation).”
The minister equally noted that the federal government had issued about N78 billion worth of tax credit to investors on road projects between 2019 and 2021 under the Road Infrastructure Development and Refurbishment Investment Tax Credit Scheme (RITCS).
RITCS was launched in 2019 to leverage private sector capital and expertise to construct, repair and maintain critical road infrastructure in key economic corridors and industrial clusters in the country.
It adopts the use of tax expenditures, via tax credits, to finance the construction of critical road and bridge infrastructure projects, while utilising an innovative public, private partnership (PPP) mechanism, aimed at the incentivisation of private sector participation and capital investments.
The minister revealed that since the inception of RITCS, President Muhammadu Buhari had approved 14 additional road projects, bringing the total to 33, with a total length of 1,564.95 kilometers as of 2021.
According to her, these additional projects are in 19 States across the six geo-political zones in the country.
She said: “In the last three years (2019 – 2021), about N78 billion worth of tax credits have been issued to investors under the RITCS. In addition, the NNPC is to finance the construction of 21 roads across the country.”
Ahmed also stated that the Nigeria Infrastructure Fund (NIF) was one of the three ring-fenced funds established under the Nigeria Sovereign Investment Authority (NSIA), adding that the role of the NIF was to catalyse the growth of key sectors; support projects of national importance and attract foreign direct investments (FDIs) in the infrastructure sector.
She noted that over a period of seven years (2015 – 2021), the NIF had invested and completed 13 projects across seven key sectors including healthcare, education, agriculture, financial services, and housing. Ahmed listed some of the completed projects as the UFF-NAIC Agri Fund, established with Old Mutual to invest in processing opportunities with backward integration to primary agriculture; the Fund for Agricultural Finance in Nigeria (FAFIN) – an agriculture-focused private equity fund for agricultural SMEs across Nigeria, and the AFAM III Fast Power – a N10.4 billion investments in the procurement and local assembly of Solar Home Systems.
In his contribution, the Minister of Works and Housing, Raji Fashola said investments in infrastructure was beginning to drive investments. He described road projects as critical infrastructure necessary to develop a country and its people for them to be able to get on with their lives in an easy and convenient way.
He said that the Ministry of Works and Housing was managing over 1,019 contracts involving 958 bridges, road projects, houses in 34 states f the federation as well as the new federal secretariats in Anambra, Nasarawa, Bayelsa, Zamfara, Osun and Ekiti States.
The Minister of Information and Culture, Alhaji Lai Mohammed said the town hall meeting was organised to showcase the achievements of government.
