The Federal Government, not quite long ago, made public its plan to privatise the transport sector. The Minister of Information, Mr. Labaram Maku, told journalists at the State House shortly after one of the weekly Federal Executive Council (FEC) meetings that four bills aimed at transforming the transport sector had been discussed. The bills are the National Transport Commission Bill, Nigerian Ports and Harbour Bill, Nigerian Railway Bill 2014 and the National Inland Waterways Bill 2014. Maku said: “To lead the way by deepening reforms; and now in the transportation sector, we are trying to take advantage of this period to deepen reforms in the transport sector by bringing on board private sector partnership”. The best way to further improve Nigeria’s economy, according to him, is to create new policies for different sectors of the economy that will drive private sector participation rather than for the government to just continue to pour in money on investments. The minister said the FG would involve the private sector in the development of infrastructure in airports, seaports and waterways. Apparently to demonstrate its commitment to the new initiative, the FG also set up a committee chaired by the Attorney General of the Federation, Mr. Bello Adoke. The Minister of Transport, Alhaji Umar Idris and stakeholders from other key sectors of the economy, especially the transport sector, are also members of the committee. They are to work on the bills and present them to the FEC for discussion and final approval soonest.
Before the latest FG initiative, however, several experts have been singing it that the Nigerian economy will require increased private sector investment to experience efficient and sustainable growth that will make meaning to the populace. We think it is commendable that the government has at last come to terms with this reality. In a February 2014 research work titled ‘Macroeconomic Determinants of Private Sector Investment – An Ardl Approach: Evidence from Nigeria’ published by Ayeni Raphael Kolade of the University of Ado Ekiti, Ekiti State, among other related works, for instance, the researcher advised the Nigerian Government to review its policies on Private Investment and pay more attention to its determinants, namely: Real Interest Rate (RIR), Real Exchange Rate (RER), Real Gross Domestic Product (GDP), Inflation Rate (INFR) and Credit to Private Sector(CRPS), all considered as essential ingredients for boosting Private Investment in Nigeria. Ayeni said the FG needed to focus on the overall institutional framework of private investment in Nigeria in order to facilitate growth and development in the country; and that curbing inflation will help very much by way of increase in output which depends mainly on infrastructure. Indeed, the government was advised to invest most generously on the provision of infrastructure to increase output, reduce inflation, interest rate, and ultimately increase private investment. It was considered dangerous leaving the determination of Real interest rate in the hands of the forces of demand and supply.
Similarly, assisting the private sector with credit facilities and making private investment a high national priority was considered inevitable.
It may be stated, however, that the FG has always been excellent when it comes to dreams and making such fantasies public, like the Information Minister recently stated about the privatization of the transport sector. But the unwholesome environment that discourages private investors from investing in the economy still persists.
Talking about the transport sector, for instance, the Federal Airports Authority of Nigeria (FAAN) announced FG’s plan to buy 30 aircraft to boost aviation industry operations in January last year. The Corporate Communications General Manager of FAAN, Mr Yakubu Dati, had said the initiative entailed buying and distributing aircraft to domestic airline operators unlike the old practice of giving out aviation intervention funds to them, which they allegedly misused. But whither the 30 aircraft till date, despite the fact that scores of private airlines have gone under since then? Again, how has the FG treated Bi-Courtney Limited, a company owned by a Nigerian that single-handedly built an airport – MMA2 – and has sustained it in the past six years as a worldclass structure? The FG is also in a fix on how to deal with the same company on its (FG’s) bizarre ‘concessioning’ of the Lagos-Ibadan highway. These are some of the valid realities, frustrations and concerns that the new transport sector privatisation framework should examine before the aforementioned bills can truly make meaning to private investors.