Former Minister of Works, Mr Babatunde Fashola (SAN), has said that Nigeria is still depending on infrastructure built in the 70s and 80s, disclosing that going by the National Infrastructure Master Plan, 2020 to 2043, the country will need an estimated $2.3 trillion over the next 21 years to develop its infrastructure.
In a speech titled: “Outlook on the Construction Industry in Nigeria over the Next Five to 10 Years” delivered at the Julius Berger Nigeria Plc “Luminary Soiree” dinner in Lagos, he argued that it is the lack of critical infrastructure like a petroleum refinery that is causing an oil producing country like Nigeria to import petroleum products.
The importation, is estimated to account for about 30 per cent of Nigeria’s forex demand.
Fashola says if there is a reduced demand of forex by up to 30 per cent for petroleum products only, followed by fertiliser and petrochemicals aggregating about 10 per cent, it will make a marked difference.
“If petroleum products are locally made, some cost reductions such as shipping, insurance and port charges will be realised and for those who have a broader view of the economy, they will understand cost-push inflation reduction and its positive impact on cost of living.
“The same is true of gas pipelines, as it is true of sea and airports, roads and bridges, and telecommunications infrastructure to deliver broadband and related infrastructure in support of economic growth and jobs.
“Simply put, every economy that seeks expansion, efficiency, and productivity must invest in the commensurate infrastructure in order to achieve it.
“Nigeria is such a country, and as I have said before, we are living largely on infrastructure built in the 70s and 80s because we spent much of the 90s in the agitation to bring back democratic Governance.
“We have a lot of building and construction to undertake and this much is evident in the latest National Infrastructure Master Plan, 2020 – 2043 estimated about $2.3 Trillion over 21 years, that is about $110 billion per annum,” he noted.
According to him, the outlook of the construction industry in Nigeria over the next five to 10 years and beyond remains highly positive as can be deduced from the government master plan.
“Therefore, very few sectors of the economy such as shipping and petroleum drive the haulage and transport sector of the economy like construction.
“From records of economic impact we kept in the Ministry of Works and Housing, I can report 1,704,300 truck trips of haulage of bitumen, diesel, laterite, sand, cement and reinforcement.
“The average minimum cost of a 30-ton truck was N200,000 per trip. So, from one ministry alone at the federal level, excluding 36 states and FCT, this represents a N340.8 billion haulage economy over 8 years or N42.6 billion per annum.
“This is the employment of transport companies their employees and drivers, enabled by construction. Drivers were then paid averagely N5,000 – N7,500 per day.
“I can report 383,431 people directly employed in constructing and rehabilitating 9,290 kilometres of roads and bridges, installing 2,270,319 linear metres of lane marking and installing 254,690 road signs.
“I can report 1,262 building contractors employed in the housing sector to construct 6,000units of housing with fittings and accessories at 46 sites across 35 states,” he explained.
