By Babajide Komolafe

The Bankers Committee real sector intervention train has berthed in Rivers State, where the Committee and the River State government  have opened discussions on financing of N578 billion infrastructure projects in the state.

sanusi

The discussion is in continuation of the Committee’s efforts to fund critical sectors of the economy in order to boost economic development.

Explaining the rationale for the projects,  Governor of Rivers State , Mr. Chibuike Rotimi Amaechi said the state is on a drive to diversify into an agro-based and knowledge-based state in a bid to reduce its dependence on oil. This disclosure was made at an interactive session between the Bankers Committee and the State Government.

He stated,  “the state is presently the highest oil producer in the country but its diversification initiative is not unconnected with the fact that earnings from oil are subjected to the vagaries in the international oil market and the militancy in the Niger Delta which has reduced oil operations and by extension oil revenue in the country generally and in the state in particular”.

It would be recalled that banks operating in the country had resolved at a national retreat on “The Role of the Nigerian Financial System in Economic Development,” organized under the umbrella of the Bankers Committee in Enugu on the need to finance critical sectors of the economy for sustainable economic development of the country.

Parts of initiatives highlighted to facilitate the actualisation of the Committee’s economic revitalisation objective was the need for them to engage state governments to identify key bankable capital projects that could be financed through issuance of development bonds.

Mallam Sanusi Lamido, the CBN Governor and Chief Executive Officers of Deposit Money Banks collectively emphasized the critical role financial institutions play in national development, and noted that unfortunately, the current structure of lending to the Nigerian economy was such that the bulk of aggregate credit is channelled mainly to financial market operators and oil traders to the neglect of key aspects of the real economy such as power, agriculture, transportation, Small and Medium Enterprises (SMEs) among others.

The retreat was sequel to the decision of the apex bank and Deposit Money Banks at the 296th Bankers Committee meeting to hold a retreat on how to articulate a collaborative approach by the financial services sector to support transformation of the most critical sectors of the economy.

On his vision for Rivers State, Governor Amaechi who delivered a paper titled ‘Driving Investment to Rivers State: Partnering with the Financial Services Sector’ expressed appreciation for the opportunity to interact with the Bankers’ Committee and noted Rivers State’s commitment to real sector development.

He explained that the critical challenges to the state’s commitment to the real sector development include access to long term funding, cost of funds required to support infrastructure projects, project management skills and willingness/capacity of financial institutions to support such projects.

He said the state has a well-articulated development programme that is being implemented, adding that in the area of Infrastructure: several roads, bridges, land reclamation/shore protection, major markets and shopping malls have been completed or are under construction and education: construction of primary and secondary schools, provision of ICT in schools, comprehensive training for teachers are initiatives the state government is committed to.

Other projects are in power: construction of three power stations, seven transmission stations and seven distribution stations are on-going, adding that the plan is to have 500MW of power available to the state by June 2011 while in the area of healthcare, the state is constructing health centres, specialist hospitals, a syringe factory and a bio-larvicide manufacturing company and mass transportation activities embarked upon include  a mono-rail, buses, land and water taxis in the area of transportation.

The state government is also engaged in environmental sustainability through various initiatives including ‘waste-to-wealth’ and scrap-to-wealth’ programmes and development of infrastructure notably the Greater Port Harcourt project in its urban renewal strategy.

The Governor enumerated the state’s efforts at good governance which include: the Quarterly Accountability forum for the State Reserve Funds of about N1 billion savings every month amounting to N21 billion presently, savings from excess crude (currently more than N37 billion; Fiscal Responsibility Bill with the state House of Assembly, Open Government Policy (Town hall meetings) and investor-friendly legal and regulatory framework.

In his presentation, he highlighted the following projects for consideration:  the $100m Monte @Rivers, Justice Adolphus Karibi White Hospital estimated to cost $120m, IP@ Rivers expected to cost N28 billion, New UST worth N60 billion, 10,000 hectare Oil Palm Estate valued at N7 billion, Mono Rail (N49 billion), Ring Road (toll road) $1.5bn, Water N35 billion, power $136.5m, Syringe factory $120m, GPH (Bulk Infrastructure for Phase 1A) N320 billion and UTC–Ada George Link Road N50 billion.

He emphasized the investor friendly nature of the state and the strength of its financial position which are attested to by the state’s Fitch rating of B+ and absence of indebtedness to any local or international bank.