The Projects And Construction Review (5th Edition) - Nigerian Chapter

Posted On 24 August, 2015

In 2014, after years of using antiquated data, the Nigerian Bureau of Statistics finally recalibrated the prices used in its gross domestic product (GDP) calculations, expanding the sectors of the economy measured and switching from 1990 prices to 2010 prices. The rebasing officially confirmed Nigeria as the largest economy in Africa and perhaps further highlighted the poor state of its infrastructure. With a GDP of about $510 billion and a population of nearly 170 million, Nigeria’s core stock of infrastructure is estimated at only about 20–25 per cent of GDP compared with the middle-income country average of about 70 per cent. The crippling infrastructure deficit, coupled with the enormous investment required to fix this deficit, has a direct impact on project financing structures in Nigeria. From the current estimates by the federal government of Nigeria, more than $3 trillion will be required over the next three decades to plug the gap.

Generally, it is accepted that government and its development partners cannot realistically be depended on to provide the requisite finance needed for overhauling infrastructure in Nigeria; and, possibly, public-private partnerships (PPP) and other private sector finance initiatives are required. In this regard, over the past few years, the government has focused on developing PPP structures and on privatising government
utilities. While privatisations have largely been successful, PPP deals have tended to drag and there remain only a few examples of successful major projects.

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