By Johnbosco Agbakwuru
PRESIDENT Muhammadu Buhari on Friday signed an Executive Order aimed at improving roads infrastructure across the country.
The Executive Order known as Executive Order 7 of 2019 on the Road Infrastructure Development and Refurbishment Investment Tax Credit Scheme is designed to develop and deliver Public Private Partnerships with notable investors so as to close the road infrastructure gap in the transportation sector.
Performing the signing ceremony at the presidential villa, Abuja, the President said under the arrangement, 19 eligible road projects are to be undertaken by 6 leading manufacturing and construction firms, located in 11 States, and in each of the six geo-political zones.
According to him, the move provides another opportunity to demonstrate the commitment of the administration to conceive, design, develop and deliver Public Private Partnerships with notable investors in order to close the road infrastructure gap in the transportation sector.
The President said there have also been revenue shortfalls that have hampered government’s efforts to fully fund critical projects. He noted that, at the inception of this administration, we met a significant backlog of local contractors’ debts, which we, as a responsible Administration, have undertaken to clear. President Buhari said his government met a significant backlog of local contractors’ debts.
The President said the Federal Government remains committed to keeping its promises to deliver qualitative roads and transportation infrastructure. The President noted that government has consistently adopted innovative solutions to complement the annual budgetary spending on infrastructure.
According to him, “I approved the establishment of a Presidential Infrastructure Development Fund, through which the Nigeria Sovereign Investment Authority is investing in critical Roads and Power Projects nationwide such as the 2nd Niger Bridge, Lagos to Ibadan Expressway, East-West Road, Abuja – Kano Road, and the Mambila Hydroelectric Power Project.”
President Buhari explained that the country’s reliance on annual budgetary allocations to fund roads development has been disappointing, given that our budget proposals have not always been passed in an expeditious manner by the National Assembly.
He said “date, N71 billion (Seventy-One Billion Naira) of funding of this N2.5 trillion (Two-point-Five Trillion Naira) initiative, has come from the Nigeria Sovereign Investment Authority, the Nigeria Liquefied Natural Gas Dividend Account, the Federal Budget, as well as counterpart funds from China Exim, China Development Banks, and other development partners.
“The N100bn (One Hundred Billion Naira) raised by the Debt Management Office through the Sukuk issuance in September 2017 has been fully deployed by the Ministry of Power, Works and Housing for 25 critical economic road projects located across each of the six Geo-political Zones.
“In December 2018 we raised an additional N100bn for funding of another set of 28 road projects also spread across the six Geo-Political Zones, “ he added.
The President said through these innovative funding mechanisms, government have been able to address the challenges of project funding, cost variation and completion risks that have plagued the development of the nation’s critical roads infrastructure assets.
“Today’s event marks another milestone in changing the narrative that has dogged past efforts at developing critical roads infrastructure nationwide. Pursuant to the Road Infrastructure Development and Refurbishment
“Through this Scheme, companies that are willing and able to spend their own funds on constructing roads to their factories or farms, will recover their construction costs by paying reduced taxes, over a period of time. We shall ensure complete transparency in these set-offs.”
The President therefore called on other local and international investors, as well as the State Governments, to embrace this roads infrastructure development Scheme.
He also invited investors to submit viable proposals for more road projects, such that, in time, the scope of this initiative will cover all 36 States of the Federation.
Speaking to State House Correspondents after the event, chairman of Dangote group, Aliko Dangote said the new Executive Order will open the space for more private sector involvement in the repair, development and maintenance of roads cross the country.
He applauding the initiative, said his firm has already flagged off the construction of the Apapa/ Oshodi road, as part of the initiative
He said, “The President has taken a bold step to change the PPP narratives in Nigeria, as government is expected to free revenue for other public project expenditures.”
He appealed for the immediate gazetting of the program to expedite action to commence the construction of the affected roads.
The Kaduna State Governor, Malam Nasir El- Rufai who spoke on behalf of the benefiting Governors, described the initiative as a win win situation for everyone, including members of the private sector, the government and the general public.
“This innovation is therefore welcome and has the support of all the Governors”
He expressed government gratitudes to the six companies who will be working on the projects, adding that the three states in Kaduna are already getting set to take off as every arrangement has been put in place.