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Saturday 07th December 2019,
Hope for Nigeria

Five Nigerian states in ‘quiet’ push for foreign funds in Johannesburg

State Finance

At least five state governors are currently making quiet moves to secure funding for some of their capital projects as the African Development Bank (AfDB) assembled direct foreign investors in Johannesburg this week.

The states are Kwara, Cross River, Abia, Ekiti and Lagos, which remotely came into the picture through its $280 million cable car project.

The ‘sky car’ project will span 12 kilometres from Ijora, Iddo and Apapa; to Lagos Island (Adeniji Adele, Obalende), Falomo and Victoria Island.

“The Lagos cable car project,” he said, “will become fully operational within the next four years, now that we have concluded the funding process for the financing of the $280m project.”

Although a handful of Development Financing Institutions are involved, Hope for Nigeria  gathered that the trio of African Development Bank, Africa Finance Corporation and African Export-Import Bank are the major financiers.

This came as the United States’ International Development Finance Corporation (IDFC), led by Adam Boehler, signed a Memorandum of Understanding to mobilise additional $5 billion for the continent over the next five years.

AfDB president, Dr Akinwunmi Adesina, disclosed that the bank and the IDFC would co-finance about $2 billion each, just as Boehler announced that the United States government has doubled the size of its IDFC Africa fund from $30 billion to $60 billion and simplified its investment portfolio to include equities.

Although none of the state governors could speak directly on why they made a quiet appearance at the AIF, the governors of Kwara, Abia and Cross River were seen holding private discussions with potential foreign investors at the “upper chambers,” hardly accessible to newsmen.

Mr. Chinenye Nwaogu, the special adviser to Abia State Governor Okezie Ikpeazu later told  Hope for Nigeria  that the state’s chief executive was at the forum at the invitation of Adesina, in connection with the AfDB-assisted infrastructure development programmes, especially the Enyimba Economic City project billed to sit on 9,803 hectares of land and spanning three local government areas of Abia State.

Nwaogu explained that approvals from relevant agencies of the Federal Government, including the Ministry of Finance and the Debt Management Office, have been secured for an initial $200 million AfDB-assisted project.

It was gathered that the AfDB had, three months ago, advanced $1million for ‘project preparation’, including the production of development designs for a 300-kilometre component of an original 500-metre road project.

“We came to thank the AfDB and appeal for speedy approval for the designs that are ready,” the governor’s aide told  Hope for Nigeria. “He (Adesina) has offered Abia State two more (funding) opportunities, including the $2.5 billion Abia Agro-Processing Zone, which the governor has mandated his team to work on.”

According to Nwaogu, AfDB, following Ikpeazu’s Johannesburg visit has invited the governor to the Ivory Coast headquarters of the bank in January next year to meet with AfDB’s project team, with a view to looking at the scale of progress and approving the designs in phases.

Ekiti State Governor Kayode Fayemi could not speak to the media as he emerged from a private meeting. His aides were however seen sharing prints of the ‘Ekiti State Investment Guide,’ a copy of which was also given to  Hope for Nigeria. A major preoccupation of the Fayemi administration currently is the Ekiti Airport project.

Cross River Governor Ben Ayade was not available for comments. But one of his aides, in response to an inquiry by  Hope for Nigeria, confirmed that it was connected with his two pet projects, the $2 billion Deep Seaport and the Superhighway.
The state government needs President Muhammadu Buhari’s approval for a sovereign guarantee on the project.

The deep seaport project embarked upon by Ayade recently attained a major milestone with issuing the Outline Business Case (OBC) certificate by the Federal Government. A sovereign guarantee will, however, boost its actualisation and provide succour following years of hardship occasioned by the loss of Bakassi, a major oil-producing hub.

Displaced Bakassi people are hopeful that the project will make up for the many losses following the ceding of their ancestral homeland to Cameroon. The Bakassi Deep Seaport is expected to be the flagship of Nigeria’s ports.

Kwara State Governor Abdulrahman Abdulrazaq, who entered a special boardroom in the company of his Cross River counterpart, was also said to have come seeking support for his pet projects. A source close to the Kwara Government House told  Hope for Nigeria: “Yes, Kwara is seeking investments in the health sector, agro-processing (especially sugar cane value chain), e-governance, education, industry, etc.”

Contrary to its relatively impressive showing at last year’s African Investment Forum, during which transactions worth more than $7 billion dollars were reportedly sealed through heavy private sector deals, the Nigerian Federal Government did not make a significant presence at boardroom discussions this year.

Hope for Nigeria nevertheless spotted President Buhari’s newly appointed Economic Adviser, Sarah Alade, on the sidelines of the three-day event. Last year, led by Vice President Yemi Osinbajo, major private sector investors including Alhaji Aliko Dangote and Mr. Tony Elumelu had made significant input at the forum.

Though there was a hint of attendance by the Minister of Finance yesterday, it was unclear why there was no official representation beyond the participation of Nigerians heading international agencies like African Export-Import Bank, Bank of Industry and a few business groups. On the contrary, presidents of many African countries participated in plenary and breakout sessions.

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