The federal government would toll the Lagos-Ibadan expressway, the Abuja-Kano road, and the second Niger Bridge to repay loans used to fund the project, according to CBN Governor Godwin Emefiele.
Emefiele made the announcement at the closing ceremony of the 12th Banker’s Committee retreat in Lagos on Wednesday.
The Infrastructure Corporation of Nigeria is funding the three projects, according to the apex bank governor (InfraCo).
“The Federal Government approached us to provide some kind of bridge funding; the bridge funding is almost about N170 billion, and we provided it so that those projects can move on with funding,” he said.
“The entire scope of those three projects, I am told is slightly above N1 trillion, but the numbers are being worked on.
“And I believe by the time the asset managers effectively come on board, the details of those projects and the remaining aspects of those funding would be coming in through debt and that is where the asset managers would come in with the entire scope and then we would know the detailed cost of those three projects.”
He also stated that tolls will be imposed on the roads in order to fund their upkeep.
“All of the roads will be tolled. And we know that in many other countries in the world, roads are tolled because those projects are commercially viable,” the CBN governor said.
“They can be refunded with tolls so that maintenance can be done on a regular basis, and people will pay for it and enjoy good roads, and enjoy good facilities because that is the only way we can fund the infrastructure of this country, which is the large amount of money that is needed.”
The CBN, African Finance Corporation, and Nigerian Sovereign Investment Authority each contributed N1 trillion to InfraCo’s N15 trillion equity, with the remaining N14 trillion coming from the debt market, according to Emefiele.
According to him, these are substantially going to be naira funding.
“The banks have a large pool of funds, the pension administrators have a large pool of funds, and we are reasonably optimistic that more than 50 percent or two-thirds of this money is going to be raised locally,” Emefiele said.
“Before we begin to think about accessing international finance, we would try as much as possible to limit debt for foreign currencies, particularly knowing that some of these projects and revenues are going to be generated with local currency.
“Where foreign currencies are needed, we will also take those and then be able to use them.”
Emefiele said that within the Nigerian financial system, there is a lot of idle capital that can be channeled to InfraCo as it was set up to give comfort to investors, especially the local investors to put their funds in these projects.
