NSE CEO, Onyema, Lists Ways to Finance Transport Infrastructure

The Chief Executive Officer (CEO) of the Nigerian Stock Exchange (NSE), Mr. Oscar Onyema, last week said the Truck Transit Parks (TTPs) dry ports projects will best be executed through private sector funding.

Onyema stated this at a breakfast meeting on the Financ- ing of Transport Infrastructure organised by the Nigerian Shippers’ Council (NSC) under the auspices of the Transportation Ministry in Lagos.

According to him, considering that the transport infrastructure development funding gap was estimated to be greater than $750 billion over the next 30 years, it becomes very clear that a way around the financing was a critical issue.

He said that the financial participation of the private sector in building infrastructure can take a number of forms, including public private partnership (PPP) and full privatisation.

“A good example is the Lekki-Epe Expressway Toll Road Concession Project, Nigeria’s first ever PPP. For this project, the Lekki Concession Company was able to secure long term financing to the tune of N50 billion for the construction phase of the project with participation from several local and international financial institutions on terms which were regarded as groundbreaking in Nigeria,” he said.

The NSE boss assured that the exchange was committed to exploring and developing innovative ways to finance the nation’s transport infrastructure in order to accelerate the growth of the key sectors of the economy. According to him, leveraging established PPP funding mechanisms, special purpose vehicle (SPV)s can utilise the NSE’s platform to gain access to low-cost, long term capital. This, he said, can be achieved through public bond issuance by a project company or by incorporating a separate company to issue bonds and lend the proceeds to the project company.

“The SPVs involved in PPP projects can alsoas focused on PPP infrastructure investments, and a good case of this is our recent partnership with the Lagos State Government and Visionscape Sanitation Solutions where a N50 billion Medium Term Note to finance the implementation of the Cleaner Lagos Initiative (CLI) was issued,” he said.