Addressing Nigeria’s infrastructure deficit

Buhari

Infrastructure  development is critical to achieving human capital development in any society. The economic impact that infrastructure improvement has on nation building cannot be over-emphasised. The growth of any country’s economy hugely depends on the status of its infrastructure. The dearth of needed infrastructure in a given society places serious limitation on human capital development.

   It is in view of its crucial role in achieving rapid economic growth that advanced nations of the world commit huge investments to infrastructural development. J.F. Kennedy, a former President of the United States of America, USA, once put the relationship between infrastructure development and economic prosperity into  proper perspective when he affirmed that: “America has good roads, not because America is rich, but America is rich because it has good roads”.

  It is in view of its crucial role in achieving rapid economic growth that advanced nations of the world commit huge investments to infrastructural development. J.F. Kennedy, a former President of the United States of America, USA, once put the relationship between infrastructure development and economic prosperity into  proper perspective when he affirmed that: “America has good roads, not because America is rich, but America is rich because it has good roads”.

    According to the World Bank, every 1% of government funds spent on infrastructure leads to an equivalent 1% increase in Gross Domestic Product (GDP), which invariably means that there is a correlation between any meaningful input in infrastructure development which reflects on economic growth indices, hence the value of infrastructure cannot be underplayed.

     In a struggling economy like ours, economic development can be further facilitated and hastened by the availability of needed infrastructure. If these facilities and services are not in place, development will be slow and full of obstacles.  Sadly, this is the stage that we are in Nigeria. It is, therefore, not surprising that the rate of economic growth and development in our country is not appreciable.

This, indeed, is part of the reason ours remain a monolithic economy that has been  hugely dependent on crude oil since independence. It is our inability to develop critical infrastructure in the country that hugely accounts for such sad development.

     According to National Bureau of Statistics (NBS), over the last decade, Nigeria’s infrastructure spending contributed a 1.9 percent (approximately $4 billion) per annum to GDP. The recommendation of the Asian Development Bank in the KPMG report is that in order for a developing country to sustain growth and development, not less than 6 percent of GDP should be invested on infrastructure.  According to a CBN figure, Nigeria is currently investing about 7 percent of GDP on infrastructure, which is above the average for Sub-Saharan Africa. However, there is the need to increase this figure to at least 12 percent of the GDP.

     Presently, our nation faces dire economic reality as a result of dwindling global price of crude oil which is the mainstay of our  economy.  There have been talks on the need to diversify the economy by focusing on other sectors such as agriculture, small scale enterprise, extractive industry, among others.

     With the dearth of a well crafted intermodal transportation mode in the country, the road remains our major and most pragmatic means of transportation. With the sad neglect of strategic infrastructure across the country over the years, our desire for the diversification of the economy might be nothing but a mere hallucination.

    Universally, constant and affordable power supply is regarded as pivotal to the economic growth of any society as it helps to sustain small and medium scale enterprises as well as galvanize local industries for optimal productivity.  

    Despite the privatization of the power sector and billions of naira spent over the years on putting the sector into shape, much still need to be done if we are to record tangible success in the sector. In this respect, the federal government’s effort at seeking for alternative sources of energy is commendable and must be sustained.

    To put the Nigerian economy on the lane to speedy recovery and growth, all tiers of governments must be immediately committed to a result-driven programme that would make infrastructure development a top priority.

    Diversifying the Nigerian economy requires huge investments in infrastructure and the federal and other tiers of governments must rightly identify this and reflect it in their budget preparation and execution. Consequently, there is need to allocate more funds to capital expenditure at the expense of recurrent spending.  This has been the secret of infrastructure development in Lagos State in the last sixteen years.

      As things currently stand, Nigeria will not be able to sustain her current trend of population and economic growth without enhancing her infrastructure status. Investing in infrastructure will, no doubt, drive economic growth, provide jobs and deliver vital services to the citizens.

   According to the World Economic Forum, every investment expended on infrastructure development in areas such as power, public transportation, the environment, security and telecommunications, generates an economic return in excess of 5% to 25%.

    It is important to stress at this juncture that the private sector must be effectively involved in any plan to enhance infrastructure development in the country.  

    The centrality of infrastructure to the overall growth of the Nigerian economy demands a fruitful partnership between the public and private sectors.

     While all tiers of government continue to work on much needed policies, plans, actions and programmes that will properly articulate a credible infrastructure development blueprint for the country, the private sector must equally be ready to resourcefully exploit available opportunities for investment in infrastructure in the country.

     To put the nation in good stead in terms of economic development and growth, there  must be a conscious effort to work towards better planning, stronger technical partnerships and inventive as well as strategic plans for financing infrastructure needs across the country.  There is no better time to invest in Nigeria’s infrastructure and no better time to contribute to the diversification of the Nigerian economy than this moment. If we are to put the Nigerian economy on a stronger footing, this remains a sure way forward.

Ogunbiyi  writes from Alausa, Lagos.

Source: The Sun Newspaper