Minister of Finance, Mrs. Kemi Adeosun has announced that the federal government is increasing budgetary allocation to the infrastructure development in the country from 10 percent in the past to 30 percent.
The minister, who spoke today, Thursday, at the United Capital launch of its Eurobond and Wealth for Women Funds, said that infrastructure development will play a fundamental role in unlocking Nigeria’s economic potential, laying a foundation for economic competitiveness and long-term future growth.
“We will now target 30% of Government expenditure on infrastructure, up from 10%.”
Adesoun emphasized that Investment in critical infrastructure across the country will unlock job and wealth creation and strengthen economic development across all States in Nigeria.
On the outlook for the Nigerian economy, the minister said that the Government is committed to increasing capital spend on critical infrastructure across key areas; power, rail, roads and water which will underpin growth in priority sectors especially Agriculture and Agro-Allied, Solid Minerals, Manufacturing, and Power.
According to her, the Federal Government will mobilize private capital to complement Government spending on infrastructure.
“We recognize that Government spending alone will be inadequate to bridge the infrastructure gap and we have started engaging the private sector through our housing fund and the road trust fund for which fundraising is in progress.”
She explained that the Government’s debt strategy is an essential part of this process, adding: “today, our debt profile is un-balanced. We borrow heavily domestically, with too short a tenure, and at a high cost.
“The impact of this is that we spend too much on interest and we crowd out the private sector from borrowing to fund their investment plans.
“This debt structure does not support our long term growth ambitions, and so it must be amended. We need longer term and cheaper finance to support the infrastructure investments we must make.
“We expect infrastructure development to underpin the return to inclusive and sustainable growth in Nigeria.”
Other speakers represented at the event included Chairman of Heirs Holdings, Tony O. Elumelu, wife of the Senate President, Toyin Saraki and President, African Women’s Development Fund, Erelu Bisi Fayemi. [myad]
