FG grants individuals licence to build, maintain highways

The Nigerian government says private individuals will be permitted to build, operate or maintain assets on some federal highways that are up for concession.

The arrangement is under the new highway development and management initiative (HDMI).

Already, the Federal Ministry of Works and Housing has received the Outline Business Case Certificate of Compliance to commence the procurement process for the concession of 12 federal highways under the HDMI.

The arrangement will lead to the use of tollgates for concessionaires to recoup investments.

In a new document on how the HDMI partnership would be executed, the FMWH stated that there were two categories, Value Added Concession and Unbundled Assets Approvals.

In the Value-Added Concession initiative, the ministry stated that the road pavement and entire right-of-way would be on concession for development and management by the concessionaire.

The ministry added that the concessionaire agreement will provide adequate highway services through the development of revenue-generating assets along the highways. It added that over 200,000 jobs will also be created by the initiative.

“Both approaches aim to provide adequate highway services through the development of revenue-generating assets along the Highway. This is key to maintaining the functionality of the highway as well as engaging and generating wealth for indigenous small and medium enterprises,” the ministry said.

“The main objective of the initiative is to attract expertise and sustainable investment/funding in the development of road infrastructure and to maximise the use of assets along the Right of Way and develop other highway infrastructure.

“It’s not really about revenue, it’s about the expected injection into the economy. The estimated private sector investment required for the development and maintenance of the 12 routes is N1.34 trillion and the impact such investment will have on the economy cannot be overstated.

“A minimum 50,000 direct jobs and over 200,000 indirect jobs are envisaged to be created spanning construction works, installations, steel fabrication, security, hospitality, vehicle repairs, waste management and administrative work as the value chain along the highway economy is activated.”

Former President Olusegun Obasanjo had ordered the demolition of tollgates in 2003, saying roads should be maintained through revenue from the increase in fuel pump price.

He had also argued that the N63 million collected daily was insignificant and that the facilities constituted inconvenience to motorists and encouraged corruption.