Frost & Sullivan, reveals a 102 trillion naira ($650 billion) investment opportunity exists in infrastructure across the energy, power and transport sectors of the Nigerian economy.
According to BusinessDay, Frost & Sullivan said the the infrastructure developments which could take up to 10 years to completely execute is fundamental to facilitating growth in Nigeria’s economy.
James Milne, Frost & Sullivan’s Environmental & Building Technologies Research Analyst, stated: “Widespread development of infrastructure will be crucial if Nigeria is to achieve its stated goal of becoming one of the twenty largest economies in the world.”
The analyst added that Nigeria’s federal government is under intense pressure to “restore, upgrade and construct new infrastructure across all sectors – particularly with regard to the provision of reliable access to energy and suitable transport facilities.”
Inadequate supply of energy and power resources remains the biggest clog in the wheel of Africa’s second largest economy, with only 40 percent of the 150 million population estimated to be connected to the national grid.
The 60 million serviced by the national grid experience regular interrupted power supply, and at times total blackouts. Large businesses resort to standby generators almost on a permanent basis, thereby escalating overheads, while small enterprise owners using generators find it very difficult to scale or fold up.
According to report, the gap in existing infrastructure is evident in the current installed energy capacity totaling approximately 6,900MW in 2011, with actual functioning capacity lower, at an estimated 3,321MW, with estimated demand almost five fold at close to 15,000 MW.
The west African nation’s decaying transport infrastructure sector is certainly another pivotal point the government has to develop to assist its economy grow rapidly.
According to Frost and Sullivan, the deplorable state to which transport infrastructures have decayed is evident in the decrease in capacity of the Nigerian Railway Corporation (NRC) between 1964 and 2005.
In 1964, Nigeria’s railway network carried three million tons of freight and three million passengers annually. As at 2005, the network transported a meager fifteen thousand tons of freight and five-hundred thousand passengers.
The significant decrease in capacity has shifted transport burden to the country’s roads, further stretching the road infrastructure which also has not experienced significant expansion or development, and leading to widespread decay in road infrastructure.
Road transportation accounts for about 70 percent of all freight transport and 90 percent of all passenger transport in the Nigeria, making it pertinent also for the government to focus on the 198,000 km road network.
