With a rapidly expanding and urbanising population, Nigeria faces a significant infrastructure deficit, projected to reach $878 billion by 2040. However, the country’s current infrastructure stock constitutes only 30% of GDP – far below the World Bank’s benchmark of 70%. Furthermore, the nation ranks behind 23 other African countries on the African Development Bank’s Africa Infrastructure Development Index (AIDI). This considerable deficit hampers economic growth, sustainable development and poverty alleviation. Despite reforms such as the National Integrated Infrastructure Master Plan and the Highway Development Management Initiative, critical deficits remain, with only 30% of the country’s estimated 200,000 road networks paved. Also, Nigeria’s railway network, plagued by vandalism and funding gaps, is still undeveloped. Despite being the cheapest means of transportation and capable of moving freight and passengers across longer distances more efficiently, rail transport constituted less than 1% of the transportation industry’s contribution to Nigeria’s gross domestic product (GDP) in 2023, which further intensifies the load on roadways.
The Federal Government’s allocation of ₦1.32 trillion (5% of the 2024 budget) for infrastructure is inadequate compared to the $100 billion annual target set by the Master Plan. To effectively address this deficit, increased private-sector investment is essential. However, private investment in Nigerian infrastructure has been low—totaling $8.4 billion from 2013 to 2023, compared to South Africa’s $17.2 billion.
Industry experts attribute the low level of private sector investment in Nigerian infrastructure to several challenges, including limited long-term financing options, inadequate maintenance practices, corruption, weak contract enforcement, and insufficient project preparation. Given the essential role of the private sector in addressing Nigeria’s infrastructure deficit, tackling these socio-economic and political obstacles to foster a more favourable investment climate is critical. Key strategies include establishing a dedicated fund for bankable projects, enhancing public sector expertise, enforcing contract sanctity, reducing corruption, and enacting targeted policy reforms. Ultimately, concerted efforts and collaboration between the public and private sectors will be essential in transforming Nigeria’s infrastructure landscape and driving long-term economic growth.
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