Vice President Yemi Osinbajo has said that the federal government will look for the right type of investors in its privatization and commercialization efforts.
He also restated the federal government’s strong commitment towards infrastructural and national economic development, and called on local investors and the international investment community to take advantage of the many opportunities offered by the Nigerian economy,
Osinbajo, who is also the chairman of the National Council on Privatization, stated these on Tuesday at the one-day investors’ webinar organized by the Bureau of Public Enterprises (BPE), in collaboration with the Nigerian Exchange Group and Nigerian Investment Promotion Commission (NIPC).
The webinar was themed: ‘Showcasing Investment Opportunities in the Federal Government of Nigeria’s Privatization and Economic Reform Programme’.
Delivering the keynote address and declaring the webinar open, the vice president said that the Buhari administration places a premium on mobilizing private capital and participation for improving efficiency and driving economic growth.
“The Federal Government of Nigeria is strongly committed to this approach to national economic development, and we consider it an important duty to create the enabling environment for the required and much-needed investment input,” he said.
The vice president noted that past sector reforms in Nigeria had brought about increased opportunities and extensive economic and social gains, including in the pension scheme, telecommunications, port, and power sectors.
He said: “For example, our pension reform, which replaced the old defined benefit scheme with the contributory pension scheme led to the creation of the Pension Commission (PENCOM), which now has over N12.3 trillion in pension fund assets.
“Similarly, the reforms of our telecommunications sector increased the number of telephone lines in the country from about 450,000 in 2001 to currently well over 140 million active telephone lines and 97.9 percent teledensity.
“Equally notable is our port sector reform which led to the concession of various terminals, bringing about major investment and transformation of the various port terminals including in revenue, employment and operational efficiency.”
He emphasized that despite the challenges, the Buhari administration remains committed to improving the country’s infrastructure and power sector, stating that “the Federal Government is working with key stakeholders in the sector to address some of the various challenges impeding its growth.”
According to him “our experience with the power sector underscores the importance of using the right moments in attracting investment, especially in the provision of infrastructure.
“And what we have seen is that while you are privatizing utilities of the size of our former Power Holding Company of Nigeria (PHCN), we simply have to be far more intentional in looking out for the right models and the right type of investors and also looking at funding for these investors over an extended period of time.”
In the area of infrastructure, Osinbajo noted that a major challenge of the Nigerian economy is its limited infrastructure stock, which is estimated to be about 35 per cent of GDP, as compared to 70 per cent of GDP in peer countries.
“It is clear that there is a shortfall there, and given the limited resources of government, government alone cannot provide the financial outlays needed to meet the very huge infrastructure deficit there is and the needs of the economy,” he noted.
Underscoring the importance of the Public-Private Partnership model in promoting infrastructure development and driving economic growth, the vice president highlighted the success being recorded by the administration’s tax credit initiative, especially in the area of road construction.
Professor Osinbajo further explained the federal government’s approval for the establishment of a N15 trillion Infrastructure Development Company (InfraCo) as another indication of the Buhari administration’s commitment to infrastructure development nationwide.
He said: “The Federal Government, through the Central Bank of Nigeria, the NSIA and the Africa Finance Corporation, among others, collaborating to establish a N15 trillion infrastructure fund under the auspices of an InfraCo is one among many exciting possibilities that will open several doors for infrastructure investment in Nigeria.
“We believe that given the credibility of the actors – CBN, NSIA, AFC, and the quantum of resources that will be deployed, the InfraCo will make a major contribution to meeting the infrastructural needs of the Nigerian economy while promoting Public-Private Partnerships.”
Other speakers at the event include the Minister of Finance, Budget, and National Planning, Dr. Zainab Ahmed; Central Bank Governor Godwin Emefiele, Director General of the Bureau of Public Enterprises (BPE), Alex Okoh; Group CEO, Nigerian Exchange Group PLC, Oscar Onyeama; Executive Secretary/CEO of NIPC, Yewande Sadiku; and the CEO, Nigerian Exchange Limited; Temi Popoola.