BusinessDay Research & Intelligence Unit (BRIU) is delighted to present the results of our Construction Survey which reflects the views of 114 professionals from segments of the Construction Industry, as well as Finance and the Public Sector. Our report provides in-depth analysis of the construction industry including trends and challenges being experienced on the ground. Sentiment for the construction industry is somewhat optimistic and the outlook for 2018 is relatively positive, with further increases in activity expected across a few strategic sectors. However, there are a number of challenges currently facing the industry, and of these, the country's currency value and access to finance/funding for activities is causing the greatest concern.

1. RESEARCH
BRIEFThe Nigerian Construction
Industry OUTLOOK
BUSINESSDAY
A Report by BusinessDay Research
& Intelligence Unit (BRIU)

2. Content
Executive Summary 4........................................
Industry Synopsis 5...........................................
Survey Insights & Analysis............................8
Latest News & Developments 12......................
Case Studies...................................................14
Conclusion & Recommendations..................17
Appendices.....................................................24
2

4. Executive Summary
BusinessDay Research & Intelligence Unit (BRIU) is delighted to present
the results of our Construction Survey which reects the views of 114
professionals from segments of the Construction Industry, as well as
Finance and the Public Sector. Our report provides in-depth analysis of
the construction industry including trends and challenges being
experienced on the ground.
Sentiment for the construction industry is somewhat optimistic and the
outlook for 2018 is relatively positive, with further increases in activity
expected across a few strategic sectors. However, there are a number of
challenges currently facing the industry, and of these, the country's
currency value and access to nance/funding for activities is causing the
greatest concern.
With the exception of Real Estate Development Sector, which is shared
equally between private and public sector nancing, other signicant
aspects of the Construction Industry is still largely inuenced by public
sector nancing (Federal and State government) for infrastructural
developmental activities.
In the 2016 Federal Government Budget, a total of N422.9 billion was
budgeted, comprising N260.082 billion for Works, N91.257 billion for
Power and N71.559 billion for housing. According to the Federal
Minister of Power, Works & Housing, during the implementation of the
2016 budget, 103 construction companies executing 192 projects were
paid who employed 17,749 people directly and 52,000 people
indirectly in works, adding that there was provision of funding under the
2017 budget in the sum of N90 billion out of which N47.169 billion has
been paid to 62 contractors working on 149 projects to continue work on
roads and bridges and keep people at work and sustain production.
But, in spite of this commitment to funding infrastructure by the
governments, industry stakeholders posit that the government cannot do
it alone because of the huge capital requirement, hence the need for
private public partnership (PPP) initiatives. According to the Managing
Director of the Infrastructure Bank, contractors working for the federal
and state governments are owed about N1.7 trillion and some of these
debts are as old as 5 to 10 years.
Analysis of data from the National Bureau of Statistics (NBS) for 2016
reected that Nigeria's construction to GDP was 4 percent. The
recommendation of the Asian Development Bank is that in order for a
developing country to sustain growth and development, not less than 6
percent of GDP should be invested on infrastructure.
Nigeria's infrastructure stock currently accounts for about 20 to 25
percent of GDP, which is signicantly lower than the global average of
70 percent. Hence, the need for accelerated and increased Private
Sector involvement and investment in the Sector, as the country requires
at least $100 billion annually for the next 30 years to meet our
infrastructure needs, as forecasted by the NIIMP.
4

5. INDUSTRY SYNOPSIS
Section
1

6. Industry Synopsis
Nigeria's Construction Industry grew
by 8 percent from the previous
quarter, according to the latest Q2
GDP gures released by the National
Bureau of Statistics (NBS). The Sector's
GDP has been improving steadily in
the last four quarters (Q3 2016 to Q2
2017). From a drop in GDP of 21
percent in Q3 2016 from the prior
quarter, the sector bounced back in
Q4 2016 recording growth in nominal
GDP of 19 percent over the previous
period and increase of 15 percent in
Q1 2017.
Subsequently, Construction GDP in
Q2 2017 of N1.17 trillion
represented nominal growth of 8
percent from Q1 2017. In real terms,
growth was 5 percent (quarter on
quarter).
Comparative analysis of Q2 2017 to
the same quarter in 2016 revealed
that the Sector grew by 18 percent in
nominal terms (year on year). The
Industry accounted for 4 percent of
Country's total GDP of N27.22 trillion
Naira in Q2 2017.
The Nigerian Construction Sector is
p r i n c i p a l l y i n vo l ve d i n t h e
development and maintenance of civil
engineering works and infrastructural
provision comprising roads, bridges,
railways, etc., as well as residential
and commercial real estate.
Opportunities for investment and
expansion abound in the Industry for
infrastructural and real estate
development activities if the right
policy, regulations and framework
are adopted and instituted. With
respect to housing development, back
in 2006, the United Nations agency
for Human Settlement, UN-HABITAT,
estimated the country's housing decit
at 17 million units. That was 11 years
ago, meaning that the decit could be
more. The market value of this decit
has been estimated at $363 billion.
The UN report states that for the
country to bridge this gap, it needs to
build between 172,000 and
200,000 housing units annually for
the next 20 years. But a recent report
on the real estate market reveals that
despite efforts at various levels of
development, not more than 50,000
units are built every year.
In the area of infrastructure
development, a 30-year roadmap
infrastructure development plan,
known as the Integrated Infrastructure
Master Plan (NIIMP) projects that
Nigeria required at least $3.05
trillion for infrastructure development
over the next three decades. The
NIIMP captures the Energy, Transport,
I n fo r m a t i o n C o m m u n i c a t i o n
Technology (ICT), Agriculture, Water,
Mining, Housing, Social Infrastructure,
Security and Vital Registration sectors
in Nigeria.
6

7. In its 2017 Budget, the Federal
Government made provision of
N246.74 billion for the Construction
and provision of xed assets.
A l l o c a t i o n t o t h e
construction/provision of roads
account of N107.39 billion
represented the bulk of total capex
followed by construction/provision of
electricity with N89.23 billion. The
total 2017 capital budget of the
Federal Ministry of Works, Housing
and Power accounted for 55 percent
of its total budgetary allocation and
29.3% of the total Federal
Government budget.
The Ministry's budgetary allocation
for the rehabilitation/repairs of
infrastructure amounted to N91.69
billion, of which 82 percent is
t a r g e t e d t owa r d t h e r o a d
rehabilitation and repairs.
Compared to many of its African
peers, Nigeria has relatively
advanced infrastructure networks that
cover extensive areas of the nation's
territory. Transport infrastructure is
inadequate though and has been
described as one of the leading
impediments to the country's growth. It
is estimated that raising the country's
infrastructure level to that of the
region's middle-income countries
could boost annual real GDP growth
by around four percentage points.
Infrastructure spend drives the real
economy, stimulates production and
industrial activity, which in turn, leads
to employment generation and
enhanced household spending.
The Government cannot do it alone
because of the huge capital
requirement. According to the
President, Commonwealth Association
of Surveying and Land Economy, cost
of construction in Nigeria ranks
among the highest in the world on
account of high interest rates,
inaccessibility to cheap affordable
funds, lack of skilled manpower,
signicant dependence on imported
construction materials; and also of
great concern is the endemic
corruption in the industry.
There is therefore need to explore
private participation in infrastructure
development in Nigeria. Globally,
contractual models and case studies
abound on successful Public-Private
Partnerships (PPPs) in construction. It is
critically important to explore
opportunities with regard to best
practices, learn lessons from case
studies, and provide guidance on
private sector involvement in
infrastructure nancing, provision and
management relevant to African
countries.
According to the Sub-Saharan Africa
Transport Policy Program (SSATP),
there is renewed interest in public-
private partnerships (PPP) for
infrastructure and service delivery in
developing countries. These
partnerships enable the public sector
to harness the expertise and
efciencies that the private sector can
b r i n g t o t h e d e l i v e r y a n d
management of infrastructure and
related ser vices. Over 100
d e ve l o p i n g c o u n t r i e s h a ve
implemented a PPP in infrastructure
since 2005 of which 50 in transport.
The average total annual private
investment in transport projects in
Africa during the 2007-2011 period
was $750 million, with an average of
three projects per year reaching
nancial closure. In 2012, 83 new
transport projects reached nancial
closure in 12 developing countries.
BREAKDOWN OF CAPITAL BUDGET EXPENDITURE BY SEGMENTSNigeria infrastructure spend (2008-2016)
Source: Budget Office of the Federation, Media
7

8. SURVEY INSIGHTS
Section
2

9. Survey Insights
42 percent of Industry players surveyed are of the view that
industry activities will increase signicantly over the next 12
months. 39 percent have adopted a more moderate view and
believe that construction industry projects will increase
somewhat. Some industry professionals are of the opinion that
the industry will not experience any increase (10 percent) while
another 10 percent of industry players, on the other hand,
opined that construction activities will somewhat decline.
A. INDUSTRY OUTLOOK
1. Outlook for the Construction Industry over the next 12 months
2. Projection on Construction Activities in 2018 compared to the Current Year
Respondents expect the most growth over the next year to occur
in Aggregates Production & Mining (84 percent); Highways,
Bridges & Roads (78 percent); Concrete & Asphalt (78 percent)
and Utility Contracting (70 percent).
The abovementioned segments are the top four expected to
increase in output and activities. Others are Industrial
Construction (68 percent) and Telecommunications (60 percent).
On the other hand, industry insiders posited that the Non-
residential; Residential; Oil & gas and Telecommunications
markets will experience minimal or negligible growth over the
same time frame in terms of construction/engineering projects
and activities.
3. Most Attractive Segments of the Construction Industry in the next 2 years
According to 27 percent of Construction professionals surveyed,
Highways, Bridges & Road projects will be the most attractive
market in the next 2 years, while 15 percent of survey
respondents are of the perspective that the Railroad
Construction market will be the most attractive in the near-term.
Concrete & Asphalt and the Utility Contracting markets were
posited by 10 percent of Industry operators equally to be the
most viable markets respectively in the same time-frame.
4. Factors posing the Most Concern to the Construction Industry in the Next 12 Months
The value of Nigeria's currency is of the most concern to the
Construction Industry. This is followed by the Economy, Input Costs
0f Raw materials and the threat of Competition. Other major
areas of concern include the Labour Supply/Skilled
Employment; Technological Changes; Cost of Operations,
among others.
5. Sale/Rental (or Purchase) of Construction Equipment
66 percent are of the opinion that rental for new equipment will
increase; 62 percent posit that the sale (or purchase) of new
equipment will also increase. In terms of used equipment, 59
percent and 55 percent of respondents estimate the increase in
the rent of used equipment and rise in the sale (or purchase) of
used equipment respectively.
9

10. On the back of the Q2 GDP gures reecting the country in
economic recovery, business condence is high among players
and experts in the Construction Industry with 88 percent of
survey respondents optimistic with respect to their expectations
of sustained improvements and continued growth regarding
industry activities and outlook. The remaining 12 percent are
pessimistic reecting lack of condence concerning their
business prospects and opportunities.
Subsequently, of the 88 percent optimistic of business prospects,
8 7 p e r c e n t a n t i c i p a t e i n c r e a s e i n b u s i n e s s
productivity/protability. In addition, 62 percent forestall
growth of their business' assets, while 52 percent further predict
expansion of their workforce in 2018.
B. BUSINESS PROSPECTS
1. Expectations on Business prospects for your Organisation in 2018
2. Expectations on Equity for Renancing or New Investment in 2018
With regards to funding, 60 percent of respondents plan to
increase their equity for renancing or new investments, while 30
percent of industry professionals expect their capital base to
remain the same, 10 percent, on the other hand, anticipate
decline in fresh equity injections.
With respect to securing debt for renancing or new investments,
46 percent believe that this will increase, 50 percent anticipate
no growth in their respective debt portfolio. The balance of 4
percent expect opportunities for new debt for renancing to
decline.
In the area of securing debt for development projects, 64
percent expect an expansion of this category of funding, on the
other hand, 28 percent expect minimal increase, while the
remaining 8 percent anticipate a reversal in terms of decline in
development-related debt.
3. Expectations on Sources of Debt for Business Activities in the Next Year
Further break-down on the sources of debt expected to increase
in 2018, 77 percent of professionals are optimistic that debt
funding from alternative lending platforms will account for the
most nancing for their business activities. This is followed by
debt funding from non-bank institutions of 57 percent, while
banks and other non-bank lenders and other institutions account
for 42 percent and 39 percent respectively.
4. Finding Qualied Workers to ll Open Positions for Work
In terms of recruitment and quality of on-site employees i.e.
ofce workforce, 55 percent of respondents revealed that it was
not difcult to recruit; 35 percent of those surveyed found it
somewhat difcult, while the remaining 10 percent encountered
difculty in sourcing for on-site labour locally.
With respect to off-site employees i.e. for technical (engineering
or construction) roles, 52 percent had no difculty, 45 percent
experienced some level of difculty, while 3 percent
encountered difculty.
Sixty-one percent had no difculty in sourcing for sub-contract
labour, 32 percent found it somewhat difcult, while 6 percent
experienced signicant difculty.
10

11. Respondents for the Survey comprised C-Suite Executives and
Industry professionals operating in various areas of the
Construction Sector. Breakdown of participants that undertook
the survey exercise reected that 21 percent are from Civil
Engineering rms; 17 percent represent the Building Materials
& Aggregate producers; 15 percent comprise the Construction
Companies & Contractors; 13 percent are in Real Estate
Development; 10 percent operate in the Banking & Finance
Sector.
Respondents from the Mor tgage Industry and
Government/Regulators each accounted for 8 percent of the
survey participants. The balance of 6 percent and 2 percent
were shared equally between the Construction Equipment
Manufacturers (6 percent) and Construction Equipment
Distributors (2%) respectively.
C. INDUSTRY INFORMATION OF SURVEY PARTICIPANTS
1. Description of Company Activity
2. Sub-Sectors where Respondents do the most work
When asked on the segments of the Industry where the
respondents and the Organisations they represented did the
most work, 22 percent revealed that Highways, Bridges &
Roads construction projects accounted for most of their
Company's activities. Residential building projects was
responsible for 15 percent of respondents' company
engagement.
Railroad construction, Oil & gas projects and Concrete & asphalt
each accounted for 9 percent of Industry rms' work
respectively, while Industrial Construction work represented 8
percent of respondents' projects. Seven percent of respondents
conducted their most work in Site preparation & excavation
work, while 6 percent carried out the bulk of Company activities
on Non-residential building projects. Utility contracting works
was the major work done by 5 percent of survey respondents.
The remaining respondents do their most work on
Telecommunications construction projects and in Aggregates
production and mining.
3. Net Prot for 2017 compared to the previous year.
Thirty–eight (38) percent of those surveyed expect net prot for
2017 to increase signicantly (15 percent or more); 50 percent
of respondents anticipate moderate growth in net prot of 5
percent to less than 15 percent. On the other hand, 13 percent
of respondents reveal that their net prot will decrease
signicantly by year-end.
4. Firm's Construction-related activity by year-end 2017 compared to 2016
When asked to provide information on aspect of each
respondent's respective rm's activities, 74 percent of those
surveyed believe that productive infrastructure services will
increase for their businesses; 63 percent are of the view that
their output product and service prices or fees as well as input
costs will increase by year-end 2017.
Private non-residential construction activities are also
anticipated to increase somewhat by year-end estimation.
Despite this, respondents are will maintain their current
employment levels and not recruit any new employees between
now and the end of the current year under review.
5. Description of Company's Annual Revenues
Breakdown of Company's annual revenues reect the
following – 40 percent generate annual turnover of less
than $5 Million; 28 percent generate income of $100
Million or more; 24 percent reveal yearly revenues of
$25 Million to less than $100 Million while the
remaining 5 percent generate $5 Million to less than $
25 Million.
6. Total Number of Employees
41 percent have a workforce over 1,000 employees;
31 percent employ 11 to 50 personnel; 14 percent
currently engage 201 to 1,000 members of staff; while
10 percent have workforce of 51 to 200 and the
remaining 3 percent surveyed have 10 or fewer
employees.
1010
11

12. LATEST NEWS & DEVELOPMENTS
Section
3

13. FG eyes private capital to fund $300bn infrastructure gap
http://www.businessdayonline.com/fg-eyes-private-capital-fund-300bn-infrastructure-gap/
Private capital seen as solution to infrastructure nancing
http://www.businessdayonline.com/private-capital-seen-solution-infrastructure-nancing/
AFC says Nigeria needs US$3trn for economic infrastructure
http://www.businessdayonline.com/afc-says-nigeria-needs-us3trn-economic-infrastructure/
Buhari, Museveni discuss transport infrastructure to link two countries
http://www.businessdayonline.com/buhari-museveni-discuss-transport-infrastructure-link-two-countries/
Infrastructure fund will transform African economies, says Adesina
http://www.businessdayonline.com/infrastructure-fund-will-transform-african-economies-says-adesina/
FG fresh privatisation of key infrastructure assets opens new opportunity for investors
http://www.businessdayonline.com/fg-fresh-privatisation-key-infrastructure-assets-opens-new-
opportunity-investors/
Infrastructure decay, insecurity, hinders Foreign Direct Investment inow to Nigeria, Study reveals
http://www.businessdayonline.com/infrastructure-decay-insecurity-hinders-foreign-direct-investment-
inow-nigeria-study-reveals/
Unresolved Infrastructure challenges stiing gas sector growth
http://www.businessdayonline.com/unresolved-infrastructure-challenges-stiing-gas-sector-growth/
Imperial City: An island urban community with ambitious infrastructure master-plan
http://www.businessdayonline.com/imperial-city-island-urban-community-ambitious-infrastructure-
master-plan/
Aligning new investments trend to solve West Africa's power Infrastructure lapses
http://www.businessdayonline.com/aligning-new-investments-trend-solve-west-africas-power-
infrastructure-lapses/
Latest News & Developments
13

14. CASE STUDIES
Section
4

15. Case Studies
The Dakar-Diamniadio Toll
Highway in Senegal
The Public-Private Infrastructure
Advisory Facility (PPIAF)'s support to
the Government of Senegal led to the
construction of the Dakar–Diamniadio
Toll Road, one of the rst toll roads to
be built in Sub-Saharan Africa
(excluding South Africa) through a
public-private partnership. The
highway will provide substantial
socioeconomic benets for the 2
million Senegalese living in Dakar and
surrounding cities. The highway is
essential to Dakar's development as a
subregional economic center. It will
reduce congestion in Dakar and
improve the ease of travel to and
from the Dakar metropolitan area,
which includes the emerging business
center of Diamniadio.
The Dakar–Diamniadio Toll road
project exemplies PPIAF's strategy
to encourage public-private
partnerships for developing priority
infrastructure projects in Sub-Saharan
Africa. The Dakar Diamniadio Toll
Highway, inaugurated on August 1,
2013 is the rst section (32 km or 20
miles) of a broader project to connect
the capital, Dakar, through a double
three-lane highway to a new airport
(Aeroport International Blaise
Diagne, AIBD) and a special economic
zone, the Dakar Integrated Special
Economic Zone (DISEZ) and the rest of
the country. The cost of this large
project is estimated to be about $696
million (FCFA 380.2 billion, excluding
grants).
The rst privately-operated toll
highway in the WAEMU region
Senac, the Senegalese subsidiary of
Eiffage that specializes in public
infrastructure projects, was awarded
a 30-year contract to operate the
highway in 2009. According to
Eiffage's estimates, an average of
26,671 vehicles per day (VPD) used
the busiest section of the highway in
2013. This gure is expected to rise to
44,797 VPD by 2036.
This brand new highway is also one of
the rst examples of a road
infrastructure project in Sub-Saharan
Africa to be completed under a
Public-Private Partnership (PPP). To
date, the highway project has created
930 jobs (800 during the construction
phase and 130 during the launch
phase). The new highway has also
improved urban mobility, opened up
access to security, transport,
administrative, health and education
services, and made it easier to access
key tourist attractions in the city.
The toll highway is just one part of a
muc h broader infrastructure
development program in Senegal,
which includes an extension to the Port
of Dakar, the construction of the new
international airport, and several
other transport projects. These new
infrastructure projects will help to
stimulate economic growth in the
manufacturing and industry sectors, as
well as boosting tourism, making
Senegal more competitive on the
world stage.
Boosting regional integration
The toll highway between Dakar and
Diamniadio is a vast project, with its
inuence stretching far beyond the
local area, and even beyond the
borders of Senegal. It is just one part
of a much broader regional project,
as the rst section of the future Trans-
African Highway between Dakar and
Lagos, a vast 4,010-km (2,490-mile)
road passing through the Economic
Community of West African States
(ECOWAS), i.e. through Mali, Guinea,
Guinea-Bissau and Gambia. This
future Trans-African Highway is a key
element of many of the priorities of
the Programme for Infrastructure
Development in Africa (PIDA), and will
help to boost long-distance trade in
the region.
15

16. N4 Toll Road from South Africa to
Mozambique
South Africa's PPP environment is
strong, with a solid track record in
delivering major projects. The 2015
EIU Africa Infrascope ranked South
Africa highest within the continent. The
country has a stable business
infrastructure, a sophisticated
nancial sector, and high standards in
accounting, regulatory structures and
law. South Africa has an important
experience in PPP projects, involving
about 300 such projects on the
national and provincial levels since
1994.
The rehabilitation of the N4 toll road
f o r m s p a r t o f t h e M a p u t o
Development Corridor (MDC) project,
between Johannesburg and Maputo,
which also includes other modes of
transport. The N4 project is the rst
major PPP project implemented,
although other PPP road projects
followed, such as the N3 between
Johannesburg and Durban.
The concession was awarded to the
Trans African Concessions (TRAC)
consortium. TRAC is responsible for the
nancing, design, construction,
rehabilitation, operation and
maintenance of the toll road.
Financing for the project was split
between 20% equity and 80% debt.
The governments of South Africa and
Mozambique jointly guaranteed the
debt of TRAC and to a certain extent
the equity. The concession contract
was signed with South African
National Roads Agency (SANRAL)
and the Mozambique Roads Agency
(ANE) and ends in 2027, after which
the road reverts back to the
governments.
For toll pricing purposes, four types of
vehicles were considered (light,
medium heavy, large heavy and
extra heavy). Tolls are collected at six
main line toll plazas and at two ramp
plazas. However, only two toll plazas
are located in Mozambique, implying
that the project is by and large
supported by toll revenues collected
along the South African road stretches
and that South African road users
subsidise Mozambican users of the
entire toll road.
The concession was initially based on
0.20 Rand per km for a light vehicle
and 0.50 Rand/km for heavy vehicles.
Nonetheless, a discount system was
introduced for commuters and local
users. Since then toll rates have
increased but the agreement
stipulates that toll tariffs can only be
increased annually in line with
consumer prices. In practice, increases
varied between South Africa and
Mozambique, due to the exchange
rate uctuation between the South
African Rand and the Mozambique
Metical.
The original agreement stipulated a
30 year concession period beginning
in 1997. This period is maintained
although in 2004, the contract was
a m e n d e d t o i n c l u d e t h e
concessionaire's responsibility over
the N4 road section between
Witbank and Pretoria. The
concessionaire now manages 630km
of toll road, the majority of which is in
South Africa and only about 50km in
Mozambique. The cost of the initial
contract was about 3 billion ZAR
(South African Rand) - about 660
million USD (in 1996 value over 30
years of which 1.5 billion Rand to be
allocated in the rst three and a half
years.
16

17. CONCLUSION
Section
5

18. CONCLUSION
With an estimated population of 182
million and GDP of US$405.1 billion
in 2016, Nigeria is Africa's most
populous country and largest
economy, yet still faces infrastructure
challenges, having committed
US$38.96 billion in infrastructure
investments since 2000, with 37 active
PPP projects under construction or in
operation as of December 2015,
according to the PPIAF.
The World Economic Forum's Global
Competitiveness Report 2016-2017
ranked Nigeria's infrastructure score
(2.10 out of 7) 132nd out of 138
countries. Nigeria's PPP readiness
shows a mixed performance, as
scored by the World Bank Group's
Benchmarking PPP Procurement
2017. Though performing better than
other Sub-Saharan African countries,
Nigeria scored worse than other low-
to-middle-income economies in two
dimensions of the benchmarking
analysis: PPP preparation and
contract management.
The PPIAF commissioned an
independent impact assessment in
February 2016 to review past
technical assistance; identify and
validate legal, institutional, and
policy reform outcomes encouraging
private participation in infrastructure;
and assess impacts of public-private
partnership (PPP) projects. According
to the results from report, the port
s e c t o r s h ow e d m e a s u r a b l e
satisfactory results for efciency and
income gains. The water and energy
sectors, however, fell short at the
regulatory level, with success and
failure tied to stakeholder
engagement and a functioning
institutional framework having well-
identied and coordinated public
and private stakeholders.
In 2008, the Federal Government of
Nigeria established the Infrastructure
Concession Regulatory Commission
(ICRC) under the Infrastructure
Concession Regulatory Commission
(establishment, etc.) Act, 2005. The
ICRC was established to regulate
Public Private Partnership (PPP)
e n d e a vo u r s o f t h e F e d e ra l
government aimed at addressing
Nigeria's physical infrastructure
decit which hampers economic
development.
The Commission published all Federal
government projects eligible for
Public Private Partnership (PPP)
contracts for the 2016/17 period.
There are over 144 projects
earmarked from the Federal
Ministries of Power, Works & Housing;
Transportation; Water Resources;
Interior; Trade & Investment; Health;
Communication Technology, etc. Total
estimated costs of the projects are
over N2.13 trillion. This publication is
meant to notify interested investors to
prepare to participate in the process
when procurement commences.
This month, the Federal Government
launched the ICRC PPP Contracts
Disclosure Web Portal to foster
transparency and accountability in
PPPs in order to attract the much-
needed foreign capital and expertise
to scale up Nigeria’s infrastructure
t h ro u g h P P P s a n d p ro m o t e
sustainable growth and development.
Currently, there are 69 projects at
various stages of development and
procurement, with 35 under
implementation. These projects cover
key sectors such as transport, energy,
social & health and telecoms.
Nigeria's annual infrastructure needs
are estimated at $3.05 trillion –
approximately 7 times Nigeria's GDP
– with $66 million of the current bill
unfunded. Nigerian governments
have historically nanced a
substantial share of the country's
infrastructure on balance sheet, with
local banks unable to supply the
amount and tenor necessary for loans,
consequently leaving many projects
unfunded.The lack of well-structured
PPP projects is the biggest constraint.
Nigeria has to have a more extended
use of the PPP model to ll the US$67
billion per year infrastructure gap.
Although, the Country has continued
on the direction of structuring a solid
PPP project pipeline to attract
investors with the work of the ICRC.
PROJECT PHASE OF INFRASTRUCTURE DEVELOPMENT PLANS
Source: ICRC
18

19. Recommendations
Political commitment:
The Government of Nigeria must set
PPP in planned or scheduled
infrastructure projects as a priority.
The rst driver must the President. But
commitment alone isn't enough; it
needs to be turned into action by
government agencies. An intra-
agency coordinating committee can
be set up in cases of projects that
impact several agencies with clearly
dened roles and time-lines for
deliverables.
Consensus-building and
stakeholder engagement:
Seminars with stakeholder groups to
discuss structuring options for
infrastructure projects and socio-
economic drivers of the willingness to
pay for services via PPPs. The
combination of careful outreach to
stakeholders, a reasonable pricing of
services, signicant time savings and a
well-maintained infrastructure means
that PPP-related projects in the
country will be accepted by the
population.
Experienced concessionaire with
strong commitment to Nigeria:
The concessionaire should have a long
history of involvement in, and
commitment to, Africa to ensure that
the project is constructed and is being
operated to a high standard, on time
and within budget.
Strong involvement of development
institutions in both public and
private nancing: Involvement of
public and private development
institutions. Development institutions
can provide long term debt-funding
and guarantees, as well as act as
arrangers and global coordinators
bringing together several investors for
PPPs.
Clear, visible benets:
Being able to provide measurable
benets to stakeholders for these
projects is key from the investor side to
the population impacted.
19

20. Reference
NBS GDP Reports
CBN Statistical Bulletin
WEF Global Competitiveness Report
SAATP PPP Road Construction Document
PPIAF Impact Stories
The Budget Ofce of the Federation Approved Budgets
InfraPPP Global Outlook Reports
World Bank Group PPP in Infrastructure Resource Centre
South Africa PPP Knowledge Lab
PPIAF Toolkit for Public-Private Partnerships in Roads & Highways
National Integrated Infrastructure Master Plan (NIIMP) Nigeria
ICRC Published PPP Projects Pipeline
The Brookings Institution Africa in Focus
AFDB Group Selected Projects
BusinessDay Newspaper Nigeria
20

21. Selected Infrastructure Organisations
Federal Ministry of Power, Works & Housing
http://www.pwh.gov.ng/
Infrastructure Concession Regulatory Commission (ICRC)
http://www.icrc.gov.ng/
Nigeria Sovereign Investment Authority – Nigeria Infrastructure Fund
http://nsia.com.ng/nigeria-infrastructure-fund/
The Infrastructure Bank Plc
http://www.infrastructurebankplc.com/
21

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This report has been informed and guided by the views, percep ons and opinions of 114 construc on professionals. These
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24. APPENDICES
Section
6

25. 25

26. 26

27. 27

28. 28

29. 29

30. Section
6
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