Protocol,
It is with immense excitement that I welcome all distinguished participants to this International Workshop on Public-Private Partnership Initiative which is indeed an epoch making event in the history of Lagos State. This workshop is holding at a very critical period in the evolution of Lagos State as a modern Mega City-State. There is great expectation among our people that Lagos State stands at the threshold of a new era of peace, progress, prosperity and security largely through the radical modernization of our infrastructure.
2. It is approximately six months since our administration assumed office and immediately swung into action to deliver on our mandate to the electorate. Within this short period, we have outlined a clear road map for actualizing our vision of a Brighter Rewarding Future for the teeming masses of our people. It is our historic responsibility to build on the impressive strides made by my immediate predecessor over the last eight years and transform our infrastructure challenges from obstacles to catalysts of poverty alleviation and sustainable development. To achieve this objective, however, requires a positive and dynamic partnership between the public and private sectors as has become the norm across the globe.
3. This workshop has accordingly been conceived as a major launching pad towards making Lagos State a model for Africa in terms of Public-Private Partnership for infrastructure development and the provision of quality social services. Public-Private Partnerships to finance infrastructure development have become inevitable in most parts of the globe because of the simple reality that government alone can not muster sufficient resources to meet the need.
4. It is estimated, for instance, that the enlarged European Union will require $500 billion to provide new public infrastructure including schools, roads, hospitals and railways. Thus, even the developed and wealthy countries of the world actively promote extra-budgetary funding of public infrastructure through Public-Private Partnerships. A few of major public infrastructure projects undertaken through PPPs in developed countries include the Airport Link, Cross City Tunnel, Lane Cove Tunnel, Sydney Harbour Tunnel and M2 Hills Motorway in Sydney, Australia; the 407 ETR toll road in Toronto, the Royal Ottawa Mental Health Centre in Ottawa, the William Osler Hospital in Brampton, Ontario and the Viva bus rapid transit network in York Region, also in Ontario, Canada.
5. Some others include the West-Link bridge on M50 motorway in Dublin, Ireland, the California State Route 125, San Diego Central Park, New York City; Chicago Skyway Bridge, Chicago and the Indiana East-West Toll Road in Northern Indiana all in the United States. And over the last ten years the United Kingdom is estimated to have expended over #33 billion on the development of new public infrastructure through the private sector. This clearly is also the route for us to go in Africa where we are confronted with exceedingly more severe crises of public finance.
6. It is unfortunate that in Nigeria the oil boom of the seventies created the false impression that government alone could shoulder the burden of development. Government was thus perceived as some benevolent ‘Father Christmas’ dispensing largesse to its children, the citizenry. This world view obviously informed the remark by a former Nigerian Head of State that the problem with Nigeria was not money but how to spend it! The severe economic depression of the last two and half decades has dispelled this illusory perception of government as the lucky custodian of limitless resources. The stark reality is that Public-Private partnership offers the only realistic route to the actualization of Nigeria’s potentials and in Lagos State; we are determined to show the light for others to find the way.
7. Let me give a brief insight into the massive investment required to meet the infrastructural challenges of Lagos State. Over the next two decades, it is projected that the state must expend at least US$ 2 billion on the expansion and modernization of its water supply network. In the same vein, the state must expend no less than US$ 715 million over a five year period to provide a qualitative and efficient road network. A crucial challenge we must undertake over the next one and a half decades is the upgrading of existing slums to uplift the quality of life of millions of men, women and children. This venture will gulp no less than US$ 185 million in the next 15 years.
8. And to achieve the objective of an efficient and effective waste management system will require the expenditure of about US$ 100 million every year for the next few years. This of course is only a tip of the ice berg as equally stupendous amounts will be required to maintain existing drainage channels and provide new ones; meet the demand for public transportation, housing and maintain effective security among others. It is obvious that only through creative Public-Private Partnerships can these targets be met. But please don’t get me wrong. We are not asking for ‘foreign aid’; a much abused concept. We are not extending a begging bowl for charity or compassionate financial hand outs. All we are seeking is for serious minded investors who will utilize our infrastructure challenges as opportunities to do profitable business in Lagos State and Nigeria.
9. The opportunities for viable investment in Lagos State are practically limitless. Power supply is one such area. Only 1000 MW is currently supplied while the actual demand is for at least 12,000 MW. The same scenario exists in the water supply sector. The effective demand is for 720 gallons per day but only 170 million gallons are generated and distributed daily. The area of waste management is another veritable gold mine for the dynamic investor. We generate about 3.3 million Metric Tons of waste per annum while only 1.25 Metric Tons is currently being collected annually. Any investment in refuse compaction and collection trucks or conversion of organic waste to wealth will no doubt pay off beyond anybody’s imagination.
10. The transportation sector is no less promising in terms of investment prospects. Our detailed and meticulous studies show, for instance, that an investment of US$ 100 million in the infrastructure for our Bus Rapid System will yield annual revenue of at least US$ 50 million. Similarly, while about US$ 787 million will be required as investment in our rail transportation infrastructure, the projected annual revenue is estimated at US$ 400 million. In the area of water transportation, the four routes we have earmarked for commencement of operations have a capacity to transport 37 million people annually with projected yearly revenue of US$ 37 million.
11. The Lekki Corridor of Lagos is reputed to be Africa’s fastest growing real estate business zone with tremendous opportunities to invest in real estate and housing development among others. We have equally awarded the design contract for the transformation of the Lagos – Badagry Expressway into an 8-lane international highway to open up the other end of Lagos for profitable investment. This is a necessary first step towards the actualization of our vision to transform the entire Badagry Corridor with its serene beaches, ancient historical monuments and rich cultural traditions into a prime destination for tourism, hospitality and entertainment in Africa. Here again, there are abundant investment opportunities for the enterprising investor.
12. I must also mention our brand new Eko Atlantic City, which has been designed as a Public Private Partnership residential and commercial estate to cost US$ 3.5 billion. The scientific and environmental impact assessment for the project, which will involve sand filling the ocean 5km backward, is presently being undertaken by a reputable by a reputable international firm with an excellent track record on infrastructure development, dredging and land reclamation. I invite potential investors to seize this golden opportunity and be part of this historic initiative.
13. The private sector equally has abundant opportunities to intervene in filling the gap between the demand for houses estimated at about one million housing units per annum and the actual supply of only 10,000 units per year. Our new Lagos Mortgage Scheme, designed to make affordable housing available to low and medium income earners with long term payment arrangement, will significantly stimulate the demand for housing stock. It will equally trigger higher demand for building materials, house hold utensils and appliances, electronics, plastics, water and electricity supply thereby opening wider investment options in the manufacturing and allied industries.
14. This international workshop on Public Private Partnership Initiative will afford us the opportunity of learning in greater detail the enormous investment potentials in the various areas I have mentioned and several others including Toll roads and bridges, health, education, slum and urban upgrading among others. Those factors that make Lagos State a prime centre of attraction for the investor are very well known but I might as well repeat some of them. Her strategic geographical location enables her to harbor West Africa’s major sea and airports. She serves as West Africa’s commercial hub by virtue of her huge population of 18 million people; a veritable market. In addition to hosting West Africa’s premier Stock Exchange, Lagos is the financial and industrial nerve centre of Nigeria. Also, the country’s telecommunication, hospitality, media and service industries revolve largely around Lagos.
15. Over the last eight years decisive steps have been taken to enhance the capacity of the public sector to partner effectively and efficiently with the private sector in promoting economic growth. The over all efficiency of the public service has been improved significantly through the comprehensive and systematic implementation of the Oracle-based Global Computerization Programme. The introduction of the Electronic Banking System in the management of the state’s finances has equally ensured greater transparency and accountability in the collection, monitoring and utilization of revenue. Again, the land registry and record system has been computerized and made more reliable through the Electronic Data Management System (EDMS) while the process of accessing and perfecting land titles have been considerably simplified and made less burdensome.
16. I make bold to say that we have in Nigeria, and particularly in Lagos State, a first class judicial system that has the courage, integrity and professionalism to guarantee the sanctity of any investment. We have considerably re-equipped the judiciary for more efficient performance through, for instance, the modernization of high courts and computerization of court registries. In the same vein, we have substantially enhanced the welfare of judicial officers at all levels to insulate them from corrupt inducement and enable them to dispense justice without fear for or favor.
17. We have also introduced viable Alternative Dispute Resolution Mechanisms to fast track the process of redressing grievances outside the formal court system. Our Administration is currently deepening the scope of judicial reforms to encompass the magistracy so that the cause of justice will be served at all levels of the judicial system. It is indeed our determination to make Lagos State the arbitration capital of Africa. We believe fervently in a credible and capable judiciary that is able to enforce agreements, protect investments and ensure the repatriation of capital when necessary.
18. Another major concern of investors is the level of security in any country where they intend to invest. Again, I make bold to say that Lagos has a relatively low crime rate when compared to other Mega-Cities of her size and population across the globe. Even then we are not relenting in our effort to reduce crime to the barest minimum that is humanly possible. For instance, we recently launched the Lagos State Security Trust Fund, designed to more effectively fund the security needs of the state on a sustainable basis. This was accompanied by the re-organization and strengthening of the state’s anti-crime outfit, the Rapid Response Squad (RRS), through the infusion of additional men, acquisition of new telecommunication equipment, bullet proof vests and uniforms, introduction of new allowances to boost morale and the provision of 25 new patrol vehicles to enhance performance. Be assured that Lagos State is very safe for the pursuit of your legitimate business.
19. We are aggressively continuing with the over-riding policy thrust inherited from the immediate past administration, which is the pursuit of poverty alleviation and sustainable economic growth. The major components of the policy include:
<!--[if !supportLists]-->1. Redefinition of the role of government<!--[endif]-->
<!--[if !supportLists]-->2. Promotion of a Private Sector-led economy<!--[endif]-->
<!--[if !supportLists]-->3. Increasing access of the people to quality basic social services<!--[endif]-->
<!--[if !supportLists]-->4. Sustenance of good governance<!--[endif]-->
<!--[if !supportLists]-->5. Human Capital Development; and<!--[endif]-->
<!--[if !supportLists]-->6. Promotion of Enhanced Partnership for Development<!--[endif]-->
My administration is eager to consolidate on the gains of the past and open new vistas of investment opportunities to the private sector. We have already started exploring the various Public Private Partnership options through Build Operate and Transfer (BOT) arrangements such as we have done with the Lekki Concession Company (LCC), on the on-going re-development of Lekki-Epe road.
20. This project offers an exciting foretaste of the potentials of PPPs for the revolutionary transformation of the infrastructural landscape of Lagos State. It is the first private sector funded Tolled road investment project of its scale and complexity in sub-Sahara Africa. Not only does this strategy reduce the pressure on government to increase taxes, It boosts the transfer of technology and skills through enhancing indigenous capacity. It is also a challenge to other states to creatively respond to the challenge of infrastructure development rather than waiting endlessly on the Federal Government.
21. We are therefore utilizing the opportunity provided by this Workshop to open other partnership options and create a win-win scenario for both government and private sector investors in the delivery of social goods to the public. Rather than be the sole provider, the emphasis of government will shift to that of enabler, facilitator and regulator focusing more on Co-ownership, co-responsibility, equity participation Debt evandees and offering Grants and reduced Tax regime to private investors willing to partner with the state on key sectoral areas discussed at this workshop.
22. We intend to immediately open a Public-Private Partnership Office under the Lagos State Ministry of Finance to implement the conclusions of this Workshop and other subsequent Public-Private Partnerships in Lagos State. This office will be a one-stop business centre for Pubic-Private partnership in Lagos State devoid of frustrating bureaucratic delays and will facilitate coordination between project initiating Ministries, Agencies of government and private sector investors.
23 Let me in conclusion express the profound gratitude of the Lagos State Government to all the sponsors of this very important programme. I urge all participants to bring their invaluable and unique experiences to bear on the implementation of Pubic Private Partnerships as an alternative investment vehicle, particularly in the provision of social goods that will promote the rapid development of Lagos State and Nigeria as a whole.
I wish you very fruitful and fulfilling deliberations.
Thank you. |
