The Central Bank of Nigeria (CBN) is calling for asset managers for a new $2.6 billion infrastructure investment company that aims to facilitate transport network projects and boost economic growth. This comes after President Muhammadu Buhari approved the creation of the Infrastructure Corporation of Nigeria (Infra-Co) in February 2021. According to the CBN, the asset managers will originate and manage infrastructure projects, generating a return from investments.
Infra-Co which focuses on infrastructure development in the giant of Africa country was established with a seed capital of 1 trillion Naira ($2.6 billion). According to the apex bank, initial capital will come from the central bank, the Nigerian Sovereign Investment Authority (NSIA), and the Africa Finance Corporation.
This call comes at a time when the country’s economy suddenly came out of recession necessitated by multiple factors like the global oil price slump and the COVID-19 (coronavirus) pandemic outbreak of 2020. Even though Nigeria has exited a recession, the economy is still very fragile. Therefore, the government is making this move to accelerate growth in the economy as transport infrastructure plays a vital role in the country’s economy.
The terrible state of Nigeria’s road networks has also continued to distort economic activities in the country. Some of these challenges include loss of goods, damaged vehicles and a rise in road robbery. According to research, the total road network in Nigeria is about 194,000 kilometres. The report also shows that about 19 percent of Nigerian roads are paved while all unpaved roads which of about 13 percent are bad roads.
Annually, Nigeria loses billions to vehicle maintenance due to bad roads to the ton of over N133.8 billion. The value of losses has increased by almost 100 percent compared to 2003. According to another report, the CBN announced in 2003 that the annual loss to the Nigerian economy due to bad roads was N8 billion, and the additional operating cost of vehicles due to potholes (bad roads) is N53. 8 billion.