By Yinka Kolawole & Rosemary Nweze
Stakeholders in the finance industry have urged the private sector to support the federal government’s drive to finance the infrastructural deficit in the country.
They spoke in Lagos, over the weekend, at the annual conference of the Finance Correspondents Association of Nigeria (FICAN) with the theme: ‘Financing Infrastructure & SMEs for inclusive growth in the post-COVID-19 economy’.
In her contribution, the Director-General, Debt Management Office (DMO), Ms Patience Oniha, asserted that the government alone cannot address the country’s infrastructural needs, as the funds are not available.
“There must be creative ways of opening up the system to enable us to bring the private sector, where we can pool the capital to fund infrastructure. That has started with what we are doing with the road clean-up infrastructure with Dangote trying to take care of some roads. Some other private sector players will enjoy tax incentive to encourage them to participate, bearing in mind that the government alone cannot do it,” she said.
The DMO boss, however, noted that there is room for more borrowing to finance infrastructure, stressing that investors have a huge interest in the country’s infrastructure development.
Oniha who was represented by Joe Ugoala, Director, Operational & Research Department at DMO, said, “ In the last edition that we just did where the country raised $4 billion, the idea was that we could raise a minimum of $3 billion and we found out that people still have an interest in our country. Even though we seemed to have doubts, the international investors still have faith.
“They still believe in the fundamentals of this economy. We were asking for $3 billion, we ended up having $12.2 billion, which was almost 400 per cent of what we actually asked for.”
The former Acting Managing Director, Bank of Industry (BoI), Dr. Waheed Olagunju, called on the government and the private sector to boost the capacity of the Small and Medium Enterprises (SMEs) sector.
According to him, “We need to build the capacity of our people; government and the organised private sector have a role to play. I believe that the government and private sector development partnership will help.”
He said the world is awash with investable funds in excess of $17 trillion, expressing that Nigeria is one of the best investment environments in the world.
“Investors are looking for where to invest and return-on-investment (RoI) in Nigeria, prior to COVID-19, was one of the highest in the world. According to UN statistics, Nigeria was ranked between 21 on RoI. Nigeria has the highest foreign direct investment in Africa. The world wants to do business with Nigeria,” he said.
On her part, Managing Director/CEO, Fidelity Bank Plc, Mrs Nneka Onyeali-Ikpe, who was represented by Osaigbovo Omorogbe, Divisional Head, SME Banking, said banks are not shying away from their responsibilities of supporting SMEs.
In her words, “Commercial banks are not running away from supporting SMEs but joining hands with the government and other stakeholders to refinance all of what you see around infrastructure which is critical to the economy.
“I think the questions that should be answered for every proposal are, ‘Is it bankable? If you are going into this, what structure should be in place to ensure that the funds we are going to put in will be recovered back because we have stakeholders and investors who are also looking towards a good result’?”