Conference Paper

Public-Private Partnership (PPP) and Infrastructure Provision in Nigeriaby Olufemi A. Oyedele

Conference: AARC HES Conference

ABSTRACT Public Private Partnership (PPP) is a collaboration of the public and private sectors in the financing and development of public goods and services (agriculture, communication, infrastructure etc). This phenomenon has been globally seen by many as the new economic paradigm. India has benefitted a lot in infrastructure provision by the private sector through PPP. Public Finance Initiative/Public Private Partnership (PFI/PPP) is a key policy instrument that is being used to transform public services. The key element of PFI/PPP is risk management. This assertion involved the creation of more public-private partnerships (PPPs). Criticisms of PFI especially by the UK Labour Party in 1997 before the election led to the introduction of PPP. The collaboration of government and the private sectors in the production of public goods and services is based on the notion that government has no business in production of some goods and services in order to ensure value for money (vfm). The experience of PPP in Nigeria has not been a thing to write home about. Concessioning of Lagos-Ibadan Expressway, Kuto-Bagana Bridge, Lekki-Epe and Maervis management of Airports have been sour. This paper will look into the factors that make PPP unsuccessful in Nigeria and will suggest recommendations for adoption.

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    ABSTRACT: The rate of urbanization in Nigeria has witnessed tremendous increase in the last two decades. Census in the early Fifties showed that there were about 56 cities in the country and about 10.6% of the total population lived in these cities. This rose dramatically to 19.1% in 1963 and 24.5% in 1985. Today, the national population is now estimated to be about 120 million with the urban population constituting about 30%. The rapid growth rate of urban population in Nigeria since the early seventies was mainly due to immigrating induced by the concentration of the gains from the oil sector in the urban areas. Given the expected increases in Urban population, the magnitude of housing problem in the country is enormous. According to the National Rolling Plan (NRP) the national housing requirement is between 500,000 and 600,000 units considering the prevailing occupancy ratio of between Three and Four persons per room. If this estimated annual requirement was to be provided at an average of N500,000 per unit (rather conservative) the costs would be enormous and indeed unrealisable. The cost of providing housing alone would be between N250 Trillion and N300 Trillion (excluding the cost of infrastructural development). This is the macro perspective of the housing problem. This is to say that the Government and Mortgage Institutions will need this much as capital base to effectively tackle the housing situation. The phenomenal rise in population, number and size of our cities over the past few years have manifested in the acute shortage of dwelling units which resulted in overcrowding, high rents, poor urban living conditions, and low infrastructure services and indeed high crime rates. On the micro-level, it has been observed that house ownership is one of the first priorities for most households and it represents the largest single investment for most (between 50% and 70% of household income). This observation becomes very significant when it is realized that per capital income in Nigeria has been on the decline (currently N3,000.00) as well as the real income of the average Nigerian. The rapid up-swing in the prices of building materials in the last five years has further reduced the affordabilities for most
  • DETR (1998) Local Government and the Private Finance Initiative: An explanatory Note on PFI and Public/Private Partnerships in Local Government Review of specific procurement issues and challenges confronting MDAs. Accessed, February .
  • The Housing of Nigerians: A review of policy development and Implementation. T Agbola .

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Jun 1, 2014