Opinion

CRSG BUILDING FROM THE BANK—By John Upan Odey

I have been in a state of excitement and yet relief since the reelection of President Muhammadu Buhari and the key reason I support this President is not because I am a member of the All Progressives Congress; it is because Nigeria can’t open her next door without addressing infrastructure and President Buhari is an infrastructure President. Many people like to talk about the economy without recourse to the basics, the economy is going no where when infrastructure can’t take the economy somewhere. Permit me to allow the larger Nigerian issues to rest a bit while we wonder home a bit.

I am a stakeholder in the Cross River project because I am a citizen and also active politically in my state. People who know me will agree that I have long disagreed with the politics of Cross River and have always insisted that we change our style of politics, for which I have disagreed on principle with politicians inside and outside my party. This is the reason I entered politics from the side of opposition and have stayed faithful to the principles of democracy and not participated for what I stand to gain but seeking what I can give from my own limited resources. I. am not stating the aforesaid to booster my person but to explain that I am not making this write up for partisan reasons.

The social media has become a rich information dump and on occasion you find information that gives you a reason to ponder. I came across such information on a WhatsApp group I belong to this morning- a memo from His Excellency the governor of Cross River State, Prof. Senator Ben Ayade to the State House of Assembly seeking an approval to issue an irrevocable standing payment order of N300M monthly to a company Messrs Sydney Construction Company Nig Ltd for the construction of the governments Super Highway project. The total contract sum is N648,870,730,739.23 (Approximately six hundred and forty nine billion naira or about $1.8B)

Going by the request for the ISPO, it would seem that government funding is the primary funding source for the project which of course would be a disaster as it would take 2,163 months or 180 years to fund the project which is clearly not feasible except the governor is only interested in paying the contractors in perpetuity or has no plans to do this project.

Sometimes ISPO’s are sought to enable the contractors source funds by convincing financiers of repayment source of loans. This superhighway wouldn’t make any bit of sense if the existing Calabar-Ikom-Ogoja-Katsina-Ala highway was in a good shape but the reasoning of a 6 lane evacuation corridor will excite anyone who has passion for infrastructure but huge projects of this sort are not embarked on a whim. It takes a large group of stakeholders to even agree to the need for such an undertaking even before we bring in hundreds of experts to study and appraise viability.

We can only look at such a project if we could design it into a public private partnership (PPP) for a number of reasons one of which is the certainty that the CRSG can not fund a $1.8B project on its current balance sheet.

The state receives an average of N2.5B from the FAAC on a monthly basis and an average of N1B IGR which combines to N3.5B or $9.7M. so by the time you throw in government recurrent expenditure, it becomes obvious that there would be no capacity for government to fund the Super Highway. The option of a PPP will however open the door to a totally new universe- the private sector.

In a typical PPP you have a couple of key stakeholders and elements among which are the government entity, the financier and the construction company. All must trust each other for a PPP model to be developed and it involves a lot of transparency.

This is the reason why it is easy to confirm that the model being used by the Ayade government is not a workable PPP, because no financier will hand $1.8B to an unverifiable company like Messrs Sydney Construction Co Ltd.

The difficulties in my party the APC in Cross river where some leaders are bickering over power can not be reason for me to keep quite in the face of this development in my beloved Cross River State.

I hereby call on the Cross River state House of assembly to immediately halt all funding to the proposed super highway and demand a public hearing on the project. Governor Ayade must convince us why we need this project and the funding model that will not land us where Donald Duke’s Tinapa has kept us.

About the author

solomonislands

Add Comment

Click here to post a comment

Video

Uniquely strategize progressive markets rather than frictionless manufactured products. Collaboratively engineer reliable.

About Author

Solomon Ogar

Social Crusader, Online Reputation Manager, Public Affairs Analyst.

Follow Me

Collaboratively harness market-driven processes whereas resource-leveling internal or "organic" sources. Competently formulate.