Minister of Works, David Umahi, has announced that the Federal Government requires over ₦16 trillion to complete inherited road projects across Nigeria.
Umahi disclosed that the current administration inherited 18,932.50 kilometers of ongoing road projects, comprising 2,064 contracts. The total value of these projects was ₦14.42 trillion as of May 2023, with ₦4.73 trillion certified, ₦3.12 trillion paid, and ₦1.61 trillion owed.
Due to recent economic changes such as the removal of fuel subsidies and the floating of the naira, the funding gap is now estimated to exceed ₦16 trillion. This figure reflects updated market conditions and excludes new projects under the Renewed Hope Agenda and four legacy projects.
Umahi explained that the traditional method of funding road projects through annual budgetary provisions has proven inadequate. To address this, alternative funding mechanisms have been adopted, including the Presidential Infrastructure Development Fund (PIDF), Sovereign SUKUK, Road Tax Credit Scheme, Public Private Partnerships (PPP), and the Renewed Hope Infrastructure Funding model.
The minister outlined that various funding sources have been utilized over recent years, including ₦100 billion from the SUKUK fund in 2017, ₦100 billion in 2018, ₦162.55 billion in 2020, and ₦210.56 billion in 2021. For 2022 and 2023, additional funds were approved, including ₦110 billion and ₦250 billion, respectively.
Umahi also mentioned that the Federal Executive Council (FEC) approved ₦2.59 trillion for 65 highway projects under Phases I and II of the NNPCL Funding, covering a total of 6,358 kilometers. However, due to inflation, the total contract sum has risen to ₦5.288 trillion, with a funding gap of ₦2.702 trillion.
To enhance road infrastructure development, the ministry introduced the Highway Development and Management Initiative (HDMI) under the Public Private Partnership Unit (PPP). This initiative aims to attract private sector investment for sustainable road development and management.
Umahi highlighted four major legacy projects under the Renewed Hope Agenda, including the Lagos-Calabar Coastal Road Corridor, Sokoto-Badagry Road, Calabar-Abuja Superhighway, and Akwanga-Jos-Bauchi-Gombe Road, designed to improve road connectivity and boost socio-economic development across Nigeria.