Leveraging the Private Sector in Bridging the Nigerian Infrastructural Deficit Gap

In many developing nation one of the major factors that has contributed to the slow pace of development, is the vast deficit in critical infrastructure that are important catalyst for economic and social growth. The need for critical infrastructure cuts across every sector of our economy and if we critically study any developed nation, we would be able to draw a strong connection between the overall emancipation of the state’s economy and the coming onboard of certain key infrastructure. This essay shall not dwell on the history of how the developed nations achieved the growth they have hitherto enjoyed, however we shall make effort to enumerate the process which governments of emerging economies can leverage in achieving these key infrastructures without breaking the bank or mortgaging the future/soul of the populace, this process could also help the government in insuring the longevity and consistent efficacy of these infrastructure.

At this point, it is imperative to establish the fact, that there is no nation on the planet even among the ‘’developed countries’’ where the elected or autocratic government provides up to 60% of the entire infrastructural needs of the state, the illusion that government has to provide everything is the major reason why stunted social/economic growth exist and open-corruption thrives in many emerging economy. If we study the ‘’developed nations’’ appropriately we would see that they have been clever enough to realise that, indeed the only business that government has in doing business is to provide frameworks/policies that would govern the livelihood of the nation and these POLICIES simply entails the blueprints that serves as a guideline for the kind development that the government desire in the state for her people and how the government intends to achieve it.

Considering the level of infrastructural deficit in our nation, it would take a miracle of a magic wand or a great deal of external borrowing between now and the next 20-30 years for the government to be able to adequately bridge the infrastructural gap that we see at the moment, this would also require great stability in the polity as well strict dedication to the national goal of development and at the same time we would have to pray ceaselessly that the borrowed fund does not end up in the private pockets of some mindless political players. The question however remains, if we chose to go on a borrowing spree, who would borrow us this humongous amount of money and at the end not request for the soul of our nation in exchange for such fund?

The good news is, the solution to the infrastructural deficits are not far fetched, we only need to look within and do a thorough overhaul of our national blueprints. To discuss this solution, I would like to focus just on four aspect of the economy which are Education, Healthcare, Logistics and Agriculture, this does not in anyway undermines the deficits that are profoundly obvious in other aspect of the economy but my bias would permit me to communicate more on these four critical sectors.

Providing Critical Infrastructure for the Educational Sector.

The last time we had a nation-wide strike in the educational sector, one of the major points given as necessitating the strike action, was poor infrastructure, which truly is a big issue in our educational system, I personally was a student at some point in UNILAG and yes I can tell of the deficits but the question is, can the Federal government make available the trillions needed to provide these needed infrastructures across the nations educational institutions……the answer is obvious…….the other point is, are the number of educational institutions currently functioning in Nigeria adequate enough to cater for our population……..the answer is also obvious……..thus what is the solution? The solution lies in leveraging the resources of the people.

How then do we leverage this untapped abundant resources of our people:

Imagine the following

- The government develops policies that allows private citizens and local companies to invest in the public educational system not as a form of endowment or charity to the state, nor as a form of FUND that would be paid to the state which would yield interest for the investor but as physical investment that entails the individual citizen or private investor (real estate company) to put up these needed infrastructure on the premises of our educational institution based on approved national standard, the investor is then entitled to earn rent on these infrastructure directly from the universities or tech colleges ''based on usage'', this rent can be subsidised by the government if necessary. The investor shall also be responsible for the maintenance of these infrastructure sine die, whereas the land upon which the investors are to situate these structures would only be made available to them on a rent agreement between the investor and the state, the land rent which shall be payable on a yearly basis and subject to a certain documented percentage of increase every 5 years.

Example

The government announces tomorrow that they need 1000 units of student apartment on the premises of UNILAG or any other tertiary institution, they present their standard in terms of quality, they make known to all that the land is available for rent, this land rent agreement is subject to revocation if the investor doesnt commence work within 12 calendar month. I can bet, that hundreds of real estate investor would come rushing in for this opportunity because they know the ROI they would make by renting the hostels to the students will be really good.

This template can also be applied to building standard lecture halls which the investors would charge a hourly rent for, like mentioned above the government can subsidise this type of rent by paying a certain percentage of the rent that accrues to the investor.

The same goes for Laboratories necessary for training the student e.g Well equipped Chemistry, Physics, Bio-Medical Labs, engineering workshops etc, which would be built, equipped and maintained and administered by the investor, the investor shall likewise charge a rent on the usage of these facilities, the payment of this rent can be subsidised as well or the student grant/loan from the state can be used by the students to pay (as school fee) for the quality education they would get from this world class standard facilities.

If we use this template we could actually build a minimum of 25 new Universities and 100 vocational colleges with world class standard structures within the next 10 to 15 years spread across the nation. For this, all the government would need to do is to provide the land, build the libraries, and the administrative building on the site, complete the road network and allow private investors to bring in their money, resources and contractors to complete the remaining structures like hostels, cafeterias, lecture halls, shopping malls and labs that are needed in each of this new Universities. After completion, the state would be responsible for providing and remunerating the academic and administrative staff to run only the academic affairs of the institution without delving into the administrative business of maintaining the private investors properties.

The benefits

• The government would forever continue to earn rent from the land leased to the investors
• Government would perpetually earn taxes on all the ROI made by the investors
• Government would earn taxes from all the workers employed to build and maintain these facilities
• The longevity of these facilities would be guaranteed because they are private owned from which profit is been made by the investor
• The issue of contractors not delivering projects on schedule would be almost non existing because the investor would not want to continue to pay rent on a land he/she is not getting any return on investment. Overall the, the nation would benefit from it immensely because these institution has the needed resources to give quality education to the students.

All it needs is the right policy that is capable of protecting the investment and guarantying the confidence of the investor.

Providing Critical Infrastructure for the Healthcare Sector.

If we desire to know how the healthcare system works in the ‘’developed nations’’ all we need to do is to pay attention to their national healthcare insurance policy, yes you might say we also have the NHIS (national health insurance scheme), but I guess we didn’t copy correctly and I would reveal that to you shortly.? Majority of the tertiary hospitals in the developed nations are not state owned on the contrary they are mainly owned and operated by the people and? by the people I mean private investors. You might say, that these investors in the developed world has got huge money chest? but I would disagree with that notion because we are aware, that majority of the big investors world wide simply depend on using credit facilities from the bank to create wealth, so it is not a question of money rather it is a question of policy.

The Solution

Imagine the government present a policy that allows the following.

• The government, declare the need to build 15 new tertiary world class hospitals across the nation
• Provide the land which would be leased to private investors (real estate investor)
• Allow the real estate investors to invest their capital and use their contractors to build these structures based on approved standard that would be fitted intrinsically with necessary conduits for the distribution of gas e.g oxygen to all the areas designated as emergency centres, wards and theatres.
• Upon completion of the whole project, the government would buy from the real estate company a portion of the entire edifice which would serve as administrative block for the management of only the healthcare services in this edifice.
• The real estate company would lease/sell out the wards and theatres to capable private companies that would furnish the wards and theatres with the necessary quality furnitures, tools and equipment
• The electricity supply, gas supply, food supply, ambulance services, laundry and sterilisation sections would also be owned and managed by different private investors
• These private investors are then entitled to charge a rent on the use of these facilities from every patient that uses it, this rent would be presented as a single bill with the healthcare service charge incurred by the patient.

You might say that this would make healthcare services expensive but mind you we are not talking about Primary Healthcare facility, we are referring to tertiary healthcare centres like LUTH, UCH, where major healthcare needs would be serviced, that would have functional and well equipped emergency and triage centre, functional and well equiped heart/kidney transplant centre, functional dialysis and ophthamological centres, well equipped theatres for major surgeries etc.

Note, this is where the National Health Insurance Scheme comes in and a possible humanitarian scheme for those who are truly incapable of footing the bills.

• The federal government health insurance policy would be made mandatory for all citizen, incoming foreigners can buy insurance policy from private insurance firms.
• The employed citizen would have a certain amount between 1000 to 10,000 Naira per month (depending on the individuals earnings) deducted from their salary as health insurance policy bill, even those living in the villages would be able to pay 1000 Naira per month if the economy is in shape
• Thus every time any citizen uses these world class healthcare services the national health insurance policy they have should be able to cover at least a minimum of 50-80% of their bills.

The government can do a 50/50 investment plan with private investors to also put our primary healthcare centres in shape and equip them adequately to serve their purpose and to pay for this quality care would likewise not be an issue so long every citizen has got the healthcare insurance policy.

The government can then choose to do the same thing with all the existing tertiary healthcare facilities in the country by way of concessioning via leasing/selling out different sections of all the old, ill-equipped and almost non-functional tertiary healthcare centres in the country.

Benefits

• The government would earn rent on the land perpetually
• The government would earn taxes from all the workers in these facilities
• The government would earn, taxes from all the ROI that accrues to the private investors
• There would be a drastic reduction in healthcare tourism
• It would increase the skills and exposure of our healthcare workers due to the world class standard equipment they have to operate
• Our citizens would have access to a more qualitative healthcare services
• We might have a return of the days when people would fly in from other nations to benefit from our quality healthcare services.

I doubt if the Nigerian government has made any profit from our existing tertiary healthcare centres in the last 40 years, this template would make the sector profitable and the government can focus her earnings on the following:

• Adequately remunerate the healthcare workers on the governments payroll
• Set up world class Research centres that would develop indigenous drugs and vaccines suitable for the nations need instead of buying from some that intend to bio-engineer our society into zombies
• Vaccines and drugs developed from this research centres would be patented and the government can lease these patents to private investors who would mass produce these vaccines and drugs locally, note this research centres would earn royalties from this patents perpetually

The benefits of overhauling our healthcare system in this manner would be endless….I can give several examples of nations that operate this system but one thing we should avoid while following this template is to ensure that no single entity is able to monopolise this critical sector.

Providing Critical Infrastructure for the Logistic Sector.

You might agree with me, that the world exist in a perpetual state of motion, in fact you the reader of this article is still breathing and alive because the logistic system in in your body is effectively still functioning, this should confirm to us, that there is no nation under the sun that can emerge successful without a functional, uninhibited and effective logistic system.

Our current national logistic system is largely inhibited and dysfunctional, you can’t have a nation of over 200 million people depending solely on dilapidated and overburdened road network system, actually, no nation has been seen to succeed with such.

So what do we do? does our government have the fund to perform the magic that would ensure the whole nation is effectively interconnected with rail networks and as well provide all the train coaches for this networks, can our government work on our water ways and also put small cargo ships on them for us, so we could use the cargo ships they provide to transport goods and services from the north to the south using the river niger channel? if i were to answer this questions, I would answer them with a long and loud silence but one thing I would mention after my silence is that, the people and the government of Nigeria has to awaken from this grave ILLUSION, ‘’we have to awake from the illusion that makes us believe as a people and a government that the leadership in power at any given time has too provide EVERYTHING’’, the truth remains, there is no where it is done in the world.

For the development of any nation to be possible and sustainable it must come as a result of collaboration between the leadership, the business minded private investors/citizens and the consumers within that nation, no single one of them can achieve sustainable development in isolation.

The Solution

Imagine the following:

• The government in partnership with our development partners signs a good loan deal to construct durable rail networks that would effectively connect the whole nation within the next 10-20 years
• The loan/fund would not be paid to the government on the contrary the government would pay the counterpart fund to the development partner who would also use their technology to construct the rail lines and deliver them as scheduled, this would reduce the possibility of the loan falling into the wrong pockets.

As this rail network are been completed and delivered ready for use in phases, the government shall do the following:

• Declare the rail sector open to private investment
• The private investors would only be allowed to invest in the purchase, administration and maintenance of the train and coaches that would run on the rail network built by the government.
• The government shall perpetually be responsible for the security and uninterrupted accessibility of all parts of the rail network to the trains operated by the private investors.
• The government shall then perpetually charge a rent for the usage of the rail network
• The rent charged would then be completely dedicated to the repayment of the loan we took from our development partner until the loan is fully recovered.

The Benefits

• Repaying the loan without itch would be 90% guaranteed because the investors who own the train and operate the train stations would run it in a business-like manner as such they would ensure the regular payment of the rent which can be enforced if they default.
• Once the entire loan is recovered, the government would perpetually make profit from the rent they charge on the rail network
• The government shall also earn taxes from the ROI that accrues to the investors as well as taxes from the workers employed to serve on the train.
• The longevity and maintenance of the train would be guaranteed as the government would only play the role of monitoring the standard and quality of service.
• The resultant effect of this functional rail system would be felt on all the economy
• The cargo train would be able to deliver food from deep in the north to the south within 24 hours
• Fuel cargos from the south could be easily and more cost effectively delivered to the deepest part of the North within 24 hours
• Military equipment can easily flow to all our military storage facilities across the nation
• The entire populace would benefit from this system
• The creation of wealth for the private citizens/investors would go on to boost all other part of the economy that needs investment.
• Our major food storage facilities built strategically around the country would be easily accessible as a result of this functional system

The government can use almost the same template with necessary adjustment to open up our water ways, make them secured and usable for investors in that sector.

Providing Critical Infrastructure for the Agricultural Sector.

I would not dwell much on this because no one would expect the government to cultivate the land on behalf of the people. However, we know, that the main problem that has continued to bedevil the food security of developing nations is actually not low production but rather the lack of facilities to store the produce after harvest. Many of our fruits, vegetables, tubers and grains go into waste as a result of this lack in critical storage facilities, even our livestocks can be processed and stored if we have the necessary facilities, asking the government to provide all these facilities would come with a huge risk of these facilities becoming moribund in a very short while, an ordinary change in government or party in power can hamper the continuous viability of these facilities if fully provided for by the government as such these are areas that private investors can be encouraged to put in their resources, the government can be more liberal with this sector by allowing the investors to own the land, build and operate these facilities and simply pay land use tax.

The government could focus on the following

• The ministry of Agriculture and Environment should collaborate to do a topographic study of the land areas in the nation to know the areas that are at risk of flooding
• After determining this, the government can work on building artificial lakes in strategic areas into which flood waters can be channeled and stored, this would prevent the flooding of our homes and farmland
• The stored flood waters can then be channeled carefully and strategically into areas where we have our major farmlands during dry season which would be of immense value if we indeed want to achieve our all year round farming activity policy or the water could be released strategically into the ocean if in excess.
• The government should also build effective road net work that would ensure farm produce are able to reach the major train terminals for onward transportation to the storage facilities owned by private investors for which the private investor would charge a rent for usage, this rent would definitely be calculated as part of the price of the farm produce when they finally get to the market from the storage facility.

Benefits

• Could reduce our experience of perennial flooding by about 50% or more
• Could boost our farm produce as we are able to irrigate our farms during dry seasons
• The storage facilities owned by the investors could help stabilise the prices of food commodities, the commodity exchange agency of the government, can work together with these storage facilities to ensure national food security by buying at every given time a specific quantity of their stored produce which the storage facility would hold in store for the government and the government would only release from these reserve whenever they intend to intervene in the rising prices of produce.
• Our farmers would be able to earn more on their produce
• The nation would be food secured and become a net exporter to areas of the world that needs our produce.

Yes I didn’t mention security, which has become really important for our farmers but that is a story for another day.

All the point I have highlighted in this article mighty sound lofty but they are achievable, there are many multi-millionaires and billionaires in our dear country who don’t even know what to do with the money they have, we can simply point them to areas where they can use this money through our strategic investment policies. There are many industrious sons and daughters of the soil who would be more than ready to invest in this projects if the government throws them open. If I were Aliko dangote , #Otedola, #Oba-Otudeko, #Tony O. Elumelu #Dr. Innocent Chukwuma, Dr. Sijibomi Ogundele LLB etc, I would invest in this projects so long I am guaranteed with written laws and policies that my investment are safe no mater the government in power. Even if I were a politically exposed person and i have got some money I don’t need at the moment, I can invest in these projects to legitimise your money. If I were #E-Money, #ObiCubana, #Obo, #2baba and many unsung billionaires and millionaires in our country, I would invest in these projects to increase and insure my wealth and lastly this is also an avenue for civil servants and salary earners who are interested in investing some of their earnings into bigger portfolios or using their employment relationship to obtain loan facilities from the bank to invest in this type of lucrative ventures. There are also many diasporas, who own properties in choice areas around the nation who would also be willing to diversify their portfolio into these projects so long the policies are clear enough without ambiguity, for me I can't imagine been given an opportunity of owning student hostels in Federal Universities and not take it.

Now we can see that the government does not have to go borrow from anyone that would hold the nation to perpetual ransom in exchange for the fund, all we have to put in place, is the right policies and strategies that would deliver us as a nation to our desired destination.

Well

I know Nigeria as a Nation shall succeed …………..

I know Africa shall prosper…………..

I know Humanity shall know profound peace…………

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