Participants at the just-concluded second annual lecture series organised by the Nigeria Institute of Quantity Surveyors (NIQS) advocated for financial sector contributions to infrastructural development, if vision 20:2010 is to be realised in Nigeria.
Speaking at the lecture series held in Lagos State recently, the Governor of Central Bank of Nigeria (CBN) Mallam Sanusi Lamido Sanusi pointed out that one of the reasons for the CBN’s reform is to ensure that the financial sector contributes to the economy, thereby serving as a driving force of infrastructure financing.
He observed that infrastructural development is grossly inadequate relative to the nation’s requirements due to lack of funds.
Mallam Sanusi who was represented by the Deputy Director, Banking Supervision, Mr. Onyebuchi Ibedu noted that the need for financial sector contribution to infrastructure financing cannot be over-emphasised while the federal government must give leverage on the bank’s roles as adviser to the president.
The CBN Governor maintained that the position of the apex bank had placed on its shoulder the responsibility of taking the lead in encouraging and examination of critical issues for economic development as well as studies on the potential of venture capital public partnership initiative.
He used the occasion to disclose that CBN intends to cooperate with the state governments in directing the financial sector’s contribution to infrastructure development.
According to him the country needs about 15 billion dollar annually over the next six years to finance infrastructural deficits in order to achieve Vision 20:2020 development plans of the present administration in Nigeria.
Also contributing, the Managing Director Chief Executive Officer (CEO) of BGL Plc, Mr. Albert Okumagba praised the Central Bank of Nigeria for institutionalising infrastructure finance office and also formulation of infrastructure policy.
Mr. Okumagba who spoke through the company’s Group Executive Director, Mr. Chibundu Edozie criticised failure of some banks to finance construction and infrastructural development.
He therefore challenged banks to come out with deliberate policy that would make relevant to the economy and also stressed the need for banks to elongate the tenure of funds to 20-25 years.
Expressing dismay that only 11 out of 24 banks in the country can comfortably lend money in the sector and called for alternative infrastructure financing strategy to the needs of the country.
In addition, he advocated for the institutionalisation of a secondary mortgage systems and recapitalisation of the Federal Mortgage Bank of Nigeria (FMBN).
Th Managing Director/Chief Executive Office, Lekki concession Company, Mr. Opuiyo Oforiokuma was of the view that if infrastructure financing must thrive, the need to attract what he described as “hot and patient money” into the sector cannot be over stated.
He noted that his firms was fortunate to have attracted financing from overseas agencies because of trust, packaging good language and antecedent.
According to him, Nigeria’s economy discourages investments especially in the construction and infrastructure sector, pointing out that in Nigeria it is as high as 50-60 per cent while in North America, it is only 20 per cent and Asia Tigers are hovering between 30 to 40 per cent.
He further observed that the formation of asset management companies by the CBN would encourage bad lending by banks adding that most enemy of financing infrastructure is the currency mismatch due to foreign funds needed to inject into its financing.