World Bank to lend Nigeria US$200 million for infrastructure upgrade

THE World Bank is to extend a loan US$200 million loan to Nigeria to improve its infrastructure, especially with its transport system.

While the country has significant economic ambitions over the next 20 years, it has a huge funding gap when it comes to upgrading and expanding its infrastructure, according to London's Containerisation International

Speaking at a recent summit in Lagos, Joe Ohiani, head of the legal and governance of the World Bank's Infrastructure Concession Regulatory Commission (ICRC), expressed regret that Nigeria's federal government had been the sole financier of infrastructure projects and had often taken responsibility for construction, operations and maintenance.

In a paper entitled, Governmental Promotion of Infrastructure Development, the World Bank executive alluded to the "deplorable state of infrastructure on the continent". His speech drew heavily on a World Economic Forum report that revealed the extent of the shortfall in investment in infrastructure in Africa.

Said Mr Ohiani: "This report showed that though annual investment in infrastructure in Africa doubled from $17 billion to $35 billion between 2001 and 2009, overall infrastructure spending needs in sub-Saharan Africa are estimated at US$93 billion annually over the next decade."

The money from the loan will be used as capital for a seed fund which in turn will establish a financial intermediary loan (FIL) scheme under the country's public private partnership (PPP) initiative. Its goal will be to provide long-term funding for infrastructure development in the country. It is understood that the Africa Finance Corporation, various commercial banks and financial intermediaries will take part in the FIL programme.

In terms of projects that will be eligible for FIL funding, Mr Ohiani said that the selection process would be based on Nigeria's national policy on PPP, the federal government's medium-term sector strategies and its national infrastructure plan called Vision 20:2020.