70% shareholding held by apex bank, says financial statement
• Initiative is stillborn, says appointed asset manager
• National budgets less than 10% of yearly expenditure need
• Low private sector participation slows race to N160tr yearly spending
About five years after ex-President Muhammadu Buhari approved the establishment of N15 trillion ($37 billion at the time it was conceived) Infrastructure Corporation of Nigeria (InfraCorp), the promoters of the public infrastructure behemoth appeared to have abandoned the project.
InfraCorp, a pet project of the former governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, was promoted by the regulator, African Finance Corporation (AFC) and the Nigeria Sovereign Investment Authority (NSIA).
The trio committed N1 trillion seed capital to the takeoff of the company they described as a game-changer in the country’s historic search for a sustainable public infrastructure funding vehicle.
But an investigation suggested the enthusiasm that birthed the scheme fizzled out with Emefiele’s exit and the company, which is barely living on paper, in neglect.
The promoting institutions would not comment on the status of their commitment, which was expected to drive public-private partnership (PPP) in infrastructure delivery.
Members of the communication teams of both the CBN and the NSIA did not speak on the matter. They asked for more time but did not respond to the inquiries despite multiple attempts at getting an official statement on the issue.
But the 2024 audited financial report released at the weekend said the CBN “holds 70 per cent of the share capital” in InfraCorp, describing the company as a “subsidiary established to harness opportunities for infrastructure development in Nigeria by originating, structuring, executing and managing end-to-end bankable projects”.
This suggests the CBN might have invested 70 per cent of the seed capital or an equivalent of N700 billion. If the parties redeemed their commitment, the money might have gone into administrative expenses and other sunk costs.
InfraCorp has maintained an office, albeit with a low-keyed operation, at the Bank of Industry (BoI) building in Abuja since 2022 when it unveiled its Managing Director, Lazarus Angbazo.
The Guardian could not verify if Angbazo was still involved in the affairs of InfraCorp at press time. However, his LinkedIn account showed his employment with the company was still active as of the last check.
The private equity expert was engaged in April 2022 and unveiled at a press conference attended by local and foreign media representatives as well as selected bank chief executives.
Angbazo’s appointment was followed by the signing of a term sheet with four asset managers in April 2022, confirming the takeoff of the operations of the much-awaited company.
The asset managers are Sanlam InfraWorks, Africa Infrastructure Investment Managers (AIIM), AAA Consortium and Chapel Hill Denham. Ike Chioke, the managing director of Afrinvest, and a member of AAA Consortium, who signed the term sheet on behalf of his company, described the initiative as “still born” while responding to an inquiry about InfraCorp’s contract with his company.
As of March, the InfraCorp office at the BoI office in Abuja was still open. But its officials kept sealed lips on its operations, the promised seed capital and its plans.
On whether the promoters have redeemed their seed capital commitment, an official of InfraCorp told The Guardian the company was “not sharing or disclosing any of our internal activities”.
Probed further, she requested a letter should be sent – but not until after three weeks as the office “is under renovation”. The discussion happened on March 28, 2025. Over a month later, the executive neither responded to her messages nor picked up calls.
Essentially, InfraCorp, which was to operate from Abuja and Lagos, was created to support and enable the appointed fund managers to mobilise resources and invest in projects across critical sectors – energy, industrial, agricultural, telecommunications, technology, transport, logistics and social infrastructure.
At its conceptualisation, Emefiele said InfraCorp would take on the funding of the Lagos-Ibadan expressway, Abuja-Kano road and the second Niger Bridge to establish itself in public consciousness as Nigeria’s new infrastructure bridge funding vehicle.
At the time, the progress of work on the three national projects was stalled by poor funding. The Lagos-Ibadan Road work, particularly, had run into two decades of slow work, with its attendant concession and funding controversies.
Emefiele had disclosed that the Federal Government approached the Bankers’ Committee, which he chaired, to provide N170 billion as a bridge fund for the three vital roads. The intervention was to be refinanced by InfraCorp on commencement and the infrastructure tolled to recoup the investment.
As part of the deal, the CBN, AFC and the NSIA were to provide the N1 trillion seed capital while another N14 trillion was to be sourced from the capital market to make up the N15 trillion equity funding, which could be leveraged in the local and international market for sustainable funding of the country’s dream public infrastructure.
A successful intervention in the three national projects would serve as the launchpad of the much-needed private sector-led infrastructure funding framework. The lead promoters all have strong working relationships with international fund managers and investors, which InfraCorp could leverage to pool the needed capital.
The scheme was hailed as the long-awaited commercially viable option for bridging the huge infrastructure deficit, which Moody’s Investors Services, said Nigeria would need to pour $3 trillion (N4.8 quadrillion at the current naira exchange value) in three decades starting from 2020 to close.
It means Nigerians would need to spend N160 trillion yearly or almost thrice the entire 2025 budget consistently for 30 years to close the gap in the stock of infrastructure and catch up with its regional and aspirational peers.
This year, sadly, the Federal Government plans to spend only N5.99 trillion or N3.7 per cent of what Moody’s considers a reasonable yearly estimate on infrastructure.
If the government spends the entire N5.99 trillion, which is over a 350 per cent increase on the N1.32 trillion budgeted last year, it would be the first time in decades the country would achieve a 100 per cent infrastructure budget performance.
Achieving that in the face of rising uncertainty over earnings, including an edging petrodollar economy, would be nothing short of magic. However, the FG’s allocation to infrastructure is just a portion of the whole national infrastructure expenditure. State and local governments also support infrastructure development in their areas except that many have been compelled to prioritise recurrent budgets in recent years.
All things being equal, the state governments will spend N17.7 trillion or 63.5 per cent of their headline N27.87 trillion budgets (according to a compilation by BudgIt), on what they loosely classify as capital projects. Even if 50 per cent of the value is extricated from vehicles, computers and many other phoney items many states mass up into ‘capital projects’, the national allocations for infrastructure would still not be more than N15 trillion. That will leave a 90.7 per cent gap. And with many states’ infrastructure budgets achieving less than 50 per cent performance, the actual government’s investment could be a mere five per cent of what is needed.
Moody’s had noted that Nigeria was behind other emerging market peers and would require significant and consistent investments to bridge the gap.
Nigeria’s investment stock is estimated at 30 per cent of the gross domestic product (GDP), a far cry from the World Bank’s recommended 70 per cent. The slow investment witnessed in the past decade has compounded the challenge and reduced the prospect of meeting the World Bank’s target.
The country’s aspiration to increase its stock of infrastructure, which is crucial for faster economic growth and improved efficiency of capital and labour inputs, faces multiple budgetary and financing constraints, including weak institutions and poor governance frameworks as well as a low tax base – a challenge that has restricted the country’s earning and narrowed the chance of increasing the speed of capital project investment growth to march the fast-growing population and rapid urbanisation.
Private participation is expected to bridge the funding gap. When properly harnessed, some analysts have noted, the private sector could speed up the race to overhaul the comatose infrastructure and stimulate the big push intervention in space similar to what China and other Asian countries did to break the ceiling of underdevelopment trap.
InfraCorp was a bold move to inspire private-sector-led infrastructure finance, leveraging the user charge model. But the initiative may have gone with the tenure of Emefiele, underpinning, for the umpteenth time, the continued excessive personalisation of public offices.
The current administration said it is committed to a private sector-led economic transformation. Two years into the life of the administration, there is no clarity on the framework for mobilising private sector funding for public infrastructure.
While InfraCorp, the most recent move at stimulating the private sector’s participation in public infrastructure building, is in the cold, the government is left with the limited conventional budget support debt instruments as vehicles for mobilising private resources for the public good. (Guardian)
