FG in­jects fresh N701bn into power sec­tor

Daily Trust - - NEWS - By Isi­aka Wak­ili

Act­ing Pres­i­dent Yemi Os­in­bajo said the Fed­eral Gov­ern­ment was in­fus­ing a mas­sive pay­ment as­sur­ance scheme of over N701 bil­lion into the power value chain to free it up.

Os­in­bajo spoke at the Ban­quet Hall of the Aso Rock Pres­i­den­tial Villa in Abuja yes­ter­day dur­ing a pro­gramme tagged “Nige­rian Ini­tia­tive for Eco­nomic Devel­op­ment”.

He said: “The power sec­tor is al­most com­pletely pri­va­tized. But we have had dif­fi­cul­ties be­cause of tar­iffs, for ex­am­ple. Many times you look at our power sec­tor, we have an in­stalled ca­pac­ity of about 12,000 megawatts to­day but we are only able to put on the grid un­der 5,000, a lit­tle above 4,000 megawatts. But we know that the po­ten­tial is way be­yond that maybe four or five times that.

“But what do we do to en­sure that we re­al­ize that po­ten­tial? What we need to do is to make this prof­itable for the pri­vate sec­tor. So, we are work­ing on the whole value chain. We are try­ing to free up that value chain, be­gin­ning with work­ing on tar­iffs, and then, look­ing at the how, at the mo­ment we have prob­lem of liq­uid­ity in the value chain and we are ad­dress­ing that. There is a mas­sive pay­ment as­sur­ance scheme of over N701 bil­lion that we are in­fus­ing into the power value chain to free up that value chain. Once we are able to do that and we ad­dress the is­sue of tar­iffs we open it up again. And then peo­ple can come in and the big in­vestors can come in and in­vest in power.

“This is a coun­try of 180 mil­lion peo­ple and in an­other 10 years’ time we are prob­a­bly go­ing to be the sixth or seventh largest coun­try in the world. There is no way we are not go­ing to need power, whether it is of­f­grid power or on-grid power. Power is re­quired by ev­ery­one where we have a ma­jor power deficit. So, we are go­ing to open up that power sec­tor and any­one who in­vests in power sec­tor will def­i­nitely make money. No ques­tion. It is go­ing to be much big­ger and bet­ter than even the tele­coms.”

The act­ing pres­i­dent de­clared that the 2017 fed­eral bud­get of over N7 tril­lion is a small amount of money. He said: “Our bud­get is N7 tril­lion this year. Now, N7 tril­lion is a small amount of money. I am not ad­ding the bud­get of the states be­cause if you add that, it comes to some­thing close to N20 tril­lion. But just look­ing at the fed­eral bud­get, it is just N7 tril­lion.”

The Na­tional As­sem­bly had on May 11 passed the 2017 Ap­pro­pri­a­tions Bill, rais­ing the bud­get from N7.28 tril­lion ear­lier pro­posed by Pres­i­dent Muham­madu Buhari in De­cem­ber last year to N7.44 tril­lion.

Os­in­bajo noted that the cur­rent pri­vate sec­tor in­vest­ments chal­lenged that size, say­ing “For ex­am­ple, the largest sin­gle line re­fin­ery in the world is a pri­vate sec­tor in­vest­ment and it’s go­ing to be do­ing 650,000 bar­rels of oil every day. That re­fin­ery is purely pri­vate sec­tor driven. Also, the largest sin­gle line fer­til­izer plant in the world is be­ing set up here. All of these will be ready by the end of 2018, some early 2019. They are huge pri­vate sec­tor in­vest­ments that com­pletely be­lie the size of the fed­eral bud­get and be­lie ev­ery­thing else.”

He said the gov­ern­ment in­tended to push the pri­vate sec­tor “And that’s why we are do­ing ev­ery­thing that we are do­ing to en­sure that the pri­vate sec­tor can come in and in­vest.”

Os­in­bajo de­scribed Nige­ria as “A place that is wait­ing to hap­pen and it will hap­pen. That’s re­ally the point. It will hap­pen. The truth of the mat­ter is that any coun­try that opens it­self to free en­ter­prise, the way Nige­ria is open­ing it­self to free en­ter­prise, will some­how find that it will work.

“That is one of the crit­i­cal things that we are bring­ing into the mix. We are in­sist­ing that the only way that this coun­try can make the profit that it needs to make is by pri­vate sec­tor in­vest­ment, be­gin­ning with lo­cal in­vest­ment. That’s why we are work­ing so hard on mak­ing the in­vest­ment cli­mate prof­itable and easy for those who are do­ing busi­ness al­ready, be­cause we be­lieve that those who are do­ing busi­ness al­ready will in­vari­ably bring in those who want to do busi­ness from out­side the coun­try, for­eign in­vest­ment etcetera.”

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