AfCTA: FG urges African Countries to Resist Pressures to Erect Trade Barriers

• $17 PPP Projects Waiting for Bidders-ICRC

With the implementation of the African Continental Free Trade Agreement (AfCTA) underway, the federal government has called on African countries to resist the pressure to erect trade barriers across their borders.

The Secretary to the Government of the Federation (SGF), Mr. Boss Mustapha, while speaking at the African Public Private Partnership (PPP) Networks Investment Summit, in Abuja, said that the continental free-trade would immensely benefit the entire region, if implemented with the needed commitment.

Mustapha also challenged authorities across the region to create business-friendly environments in order to attract the much-needed private capital for the development of infrastructure.

The SGF said “To be able to stimulate and create a vibrant private sector on the continent and accelerate infrastructure development, a number of issues must be addressed. There is definitely the need to create a welcoming investment climate. This can be achieved by reducing risks and costs of doing business and by securing private property rights, improving governance, fighting corruption, simplifying regulations, and promoting competition.

“African governments must also resist pressure to erect trade barriers for intra-African trade to flourish. Currently, intra-African trade amongst African states is about 10 o of total exports. This is the lowest amongst other regions in the world. But we strongly believe that with the initiative of the African Continental Free Trade Agreement the situation will drastically improve.”

According to him, “There is also the need for financial sector development by strengthening regulatory and institutional frameworks to improve governance and increase competition, improving access to finance and financial literacy, developing payment systems, and enhancing creditor rights. Similarly, access to finance by the private sector is equally very key.”

He posited that the public-private partnership (PPP) has become a very viable procurement option, as well as, a reliable and dependable vehicle for accelerating infrastructure development and structural transformation in many economies across the globe.

In his words: “The advantages of PPPs over traditional procurement methods are quite profound and well documented. Suffice to say, however, that PPPs are well Known for mobilizing additional sources of funding and financing for infrastructure.

“PPPs also help to improve project selection, subjecting assumptions to the market test of attracting private finance. Indeed, countries with relatively long PPP histories have found PPPs very useful for managing construction, with adequate maintenance of assets, better than traditional procurement, with projects coming in on time and on a budget more often.

“There is no doubt, given the constraints on the public budget for financing the ever-growing infrastructure needs and in keeping with the practice in other nations with similar situations, the Federal Government of Nigeria (FGN) has encouraged and supported the strengthening of the framework for Public-Private Partnership (PPP) policy.”

He revealed that the huge infrastructure gap on the continent presented equally huge investment opportunities for the private sector.

“Africa faces huge infrastructure gaps, but this also presents huge opportunities for private investment through public-private partnerships, especially in energy, housing, transportation, agriculture, technology, waste management, and social services and amenities,” the SGF said.

On his part, the Ag. Director-General of the Infrastructure Concession Regulatory Commission (ICRC), Mr. Michael Ohiani, announced that as at 2021, the organization had prepared 51 PPP projects worth $17 billion but had no bidders.

Ohiani said: “In 2021, we published a pipeline of 51 eligible and bankable PPP projects worth over $ 17 Billion. This list contains the projects from different economic sectors which have been granted the Outline Business Case Compliance Certificates, but which did not have identified bidders.”

He stated further that in the current year, ICRC planned to gazette a pipeline of 53 eligible and bankable PPP projects, worth about USD 22 Billion.

The Ag. D-G highlighted that as part of his organisation’s achievement, between 2010 and last year, under the regulatory guidance of the ICRC, the federal government had approved PPP projects worth more than $ 9 Billion.