|Delayed - 01/15 04:00:02 pm|
Moody : Nigeria Needs N3tn to Tackle Infrastructure Deficit, Says Moody's
|11/20/2020 | 02:06am|
One of the leading global rating agencies, Moody's Investors Service, has stated that the infrastructure in
Given the budget constraints facing the country, the rating agency noted that addressing this shortfall will require financing from the private sector, multilateral development institutions and other non-state investors.
The company, in its first report on the Nigerian infrastructure market obtained yesterday, noted that
It stated that weak institutions and governance frameworks along with a low tax base are hindering infrastructure investment, while financially strained utilities are unable to invest in improvements.
It said: "
"There are major budgetary and financing challenges to developing infrastructure in
"Infrastructure development has been concentrated on economic infrastructure and this focus will continue. Investment has primarily been within economic infrastructure such as power, railways, roads, ports and pipelines; rather than social infrastructure such as hospitals and schools."
According to it,
It added that
Financial guarantors, multilateral development banks and local institutional investors will be important in helping finance infrastructure development, it said.
"In its Economic Recovery and Growth Plan 2017-2020 (ERGP), the Nigerian government estimated that the country's infrastructure stock represented only 35 per cent of GDP, compared with an average of 70 per cent for peer emerging market countries.
"The National Integrated Infrastructure Master Plan (NIIMP), which set out priorities for 30 years to 2043, estimated
"In its 2020-2024 Nigeria Strategy Paper, the
The report, however, showed that the country's share of the population with access to electricity increased from 40 per cent in 2015 to 54 per cent in 2020.
It said: "The generation capacity is constrained by the unavailability of gas feedstock (despite
"Citizens who have access to the grid electricity face regular power cuts. Of the around 90 million Nigerians reported to have no access to electricity, 17 million live in urban areas, while 73 million live in rural communities, which means that a majority of the non-electrified population live in off-grid areas where the provision of grid supply is not economic because of the high cost of constructing transmission infrastructure.
"The government has a low tax base relative to Sub-Saharan Africa (SSA) peers. Corruption is of particular concern to investors in large, capital intensive infrastructure projects that require years of planning, land negotiations and permitting, and regulatory approvals."
Commenting on the findings of the report, Vice President, Senior Analyst at
"Its low government funding capacity and customer affordability has been weakened further by the Coronavirus pandemic and low oil prices."
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