The Senate has announced its approval of a Federal Government loan of $22.7 billion (about #8.3 trillion) for the construction of major infrastructures in the country.
Before the loan was approved by the senate days ago, it was first brought before the house in December of 2019. The bill was however rejected by the 8th Assembly on the grounds that it was not explicit enough to justify the amount that was being requested.
However, despite the World Bank warning that without major revenue reforms, Nigeria’s debts could rise to almost 36% of GDP by 2024, the senate still went ahead with its approval. This means that by as soon as 2024, debt servicing could be taking as much as 75% of government revenue.
The approval has invariably generated huge controversy around the country and even withing the senate itself. While some think the loan request should have been scrutinized more thoroughly, others including the Senate President think the bill is for the common good, and only needs to ensure that funds are spent for what they were allocated.
It is therefore with this hope that the funds will be applied positively that I decided to look at certain sectors of the economy that are supposed to be strengthened by the loan. These sectors are directly connected to the technology space in Nigeria.
Digitisation of NTA
Some weeks back, the Minister for Information and Culture, Lai Mohammed, said that if the $500 million was approved for the Nigerian Television Authority, the national broadcaster would be able to compete on the same level with international broadcasters like the Cable News Network (CNN).
Well, the time has come to put that claim to the test because from that $22.7 billion, $500 million has been earmarked to fuel the transformation of the NTA.
The fund is expected to be employed to digitally renovate all the branches of the NTA in the country.
Broadband
Another portion of the money, also to be employed in the communication sector, is for phase two of the National Information and Communication Technology Infrastructural Backbone Project (NICTIB).
The NICTIB project was designed to lay 1,482KM of Optical Fibre Cable Backbone network to cover:
(a) Abuja to Onitsha; Lagos to Onitsha; Uyo to Onitsha; for the Phase I.
(b) Construction of Data Centres in Abuja and Enugu
(c) Provision of Metro Access Network systems to be located in Abuja, Makurdi, Enugu, as well as;
(d) Provision of Upload and Download service points in Uyo, Eket, Port Harcourt, Owerri, Onitsha, Asaba, Awka, Benin, Ore, Lagos, Enugu, Makurdi, Lafia and Abuja.
This project will gulp $328.1m from the entire loan. It will be used to improve connectivity and other ICT infrastructure between Ministries, Departments and Agencies of the Government in certain states.
The states targeted in the second phase of the project are Lagos, Abuja, Ibadan, Akure, Maiduguri, Lokoja, Kaduna, Akwanga, Bauchi, Kano, Katsina)
Power
Part of the loan will be used to further address the pitiful state of electricity transmission in the country. $200 million will be used in the power transmission project from Lagos to Ogun state.
Realizing the need to bring the technical know-how of the people in the power sector up to current standards, $50 million will be used to carry out vocational training in the sector.
The training will take place in the FCT, Lagos, Ogun, Kano, Plateau, Niger, Enugu, Kaduna and Cross River states.
It appears that the power transmission sector will receive a major boost from this loan. The Transmission Company of Nigeria (TCN) will have its overall transportation system overhauled with $200 million. The TCN project will happen nationwide.
As the transmission sector is receiving attention, generation of electricity is also receiving major attention with the allocation of $4.8 billion for the Mambila hydro-electric power project.
The Mambila Hydroelectric Power Station is a 3,050 MW hydroelectric power dam that is still under construction in Taraba state. After the successful completion of the project, Mambila will be the largest power-generating installation in the country, and one of the largest hydroelectric power stations in Africa.
Still in the power sector, an additional $364 million will be committed to the Nigerian Electricity Transmission and Access Project. This will be spread nationwide.
The remnants of the loan have been distributed across other sectors to increase the quality of services and experiences that Nigerians get from these sectors.
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