Mr Adekunle Oyinloye, Managing Director of the Infrastructure Bank, says Public Private Partnership (PPP) and other alternative financing mechanism would bridge the infrastructure deficit in the country.
Oyinloye said this while speaking on ways of attracting private capital for infrastructure development in Nigeria at a forum of set 1988 Economics Class, Ahmadu Bello University, Zaria in Abuja.
He noted that these mechanisms would attract private capital for design, financing, construction, operation and maintenance of infrastructure in the country.
According to Oyinloye, the escalating infrastructure deficit in the country is attributed to low investment in infrastructure by public authorities.
He said this was occasioned by budgetary and fiscal constraints, inadequate national planning and project prioritisation, policy instability, contractual inefficiencies among others.
According to him, Nigeria’s annual fiscal appropriations for infrastructure stands at about 5 billion dollars per annum, showing a significant funding shortfall for addressing the deficit.
He explained that about 48 per cent of funding required to bridge the wide infrastructure deficit in the country can be sourced from the private sector.
“Based on our experience across the infrastructure landscape, we can assert that private investors and financiers are willing to commit capital to fund the infrastructure deficit.
“PPP are a very potent tool for channeling investments into the infrastructure space.
“Clearly, where the government demonstrates the will to implement projects through PPP, investors’ appetite shall continue to grow for commercially viable infrastructure projects.
“This ensures that private investors take on financing, development and operating risks whilst the government maintains regulatory oversight of the sector.
“Under this model, the private sector plays the crucial role of plugging funding gaps as well as instituting efficient operation and maintenance regimes, post construction to ensure return on investments in a sustainable manner.
“There is therefore absolutely no doubt that the private sector has the ability to mobilise the required financial resources to fund the nation’s infrastructure development,” Oyinloye said.
He, however, urged that funds be made available and accessible to policy makers and regulators with interest in the development and operation of new and existing infrastructure.
He said: “With the tracking of economic indices and infrastructure investment, the Federal Government will be forced by the sheer deluge of facts to focus squarely on delivering funding for infrastructure development.
“The government will do this through any necessary means including demonstrating the will to implement key projects via PPP.”
He reiterated that the infrastructure bank had deliberately crafted a niche market within which it is the leading provider of project finance solutions for the much needed infrastructure projects.
He said the bank had acquired and developed the requisite expertise and technical capacity to ensure it delivered on its mandate without compromise.
“We stand ready, willing and able to support the development and implementation of any viable infrastructure project wherever the need arises in our nation,” Oyinloye said. (NAN)