Full text of President Jonathan’s speech at Infrastructure Summit, World Economic Forum, South Africa today

Excellencies

Distinguished Ladies and Gentlemen,

1. I am delighted to be here with you today and to have the opportunity to make a few remarks on infrastructure, which is a major challenge facing the African continent. I thank the World Economic Forum (WEF) for creating the environment and providing the platform for this to happen.

2. Let me also express my appreciation to the African Union Commission (AUC), the United Nations Economic Commission for Africa (UNECA), the African Development Bank (AfDB) and the NEPAD planning and coordinating Agency for establishing this infrastructure plan for Africa, appropriately christened Programme for Infrastructure Development in Africa (PIDA).

3. In the last decade, Africa has come a long way from being mainly associated with economic stagnation, high inflation, high external debts, and civil strife. Today, the situation has changed due to significant macroeconomic, structural, and political reforms. Economic growth on the continent averaged 5% annually in the last 10 years.

4. However, despite this recent economic growth success story of the continent, infrastructure deficit on the continent across transport, energy, and communication remain binding constraints to further growth acceleration, our ability to compete, and the reduction in poverty.

5. Inadequate and poor infrastructure in Africa remains a major constraint to the continent’s realisation of its full economic potential. Due to the relatively poor infrastructure and low connectivity on the continent, we have the lowest level of inter-regional trade. While we account for about 12% of the world’s population, our share of global trade is just about 2%. This is also a reflection of the fact that our economies are less diversified compared to other global regions.

6. Most importantly, poor infrastructure serves as additional burden and cost to our businesses, making it difficult for them to compete, and accompanied by structural and high level of unemployment. To effectively tackle these challenges, diversify our economies, reduce poverty and provide employment opportunities for our bulging youth population, we must build necessary infrastructure in Africa across transport, communication and energy sectors.

7. Over the course of this past decade, African stakeholders have recognised the need to plug the gaps in infrastructure on the continent. From studies and reports on the subject, it is estimated that Africa requires about 100 billion US dollars annually for the next decade, whereas only a quarter is being spent today.

8. Due to limited fiscal resources, Governments alone cannot build the infrastructure that Africa needs. Therefore, as we look to solving our infrastructural challenge, the underlying binding factor is finance. We must therefore continue to develop new innovations and ways of achieving this.

9. Besides finance, our experience has shown that without a common framework as a basis for collaboration, little progress will be made. I am especially delighted then that PIDA is building on the plans already established under different initiatives such as the NEPAD Medium to Long Term Strategic Framework and the AU Infrastructure Master Plans.

10. As part of this infrastructure initiative, Nigeria is leading the efforts to construct the Nigeria – Algeria Gas Pipeline Project to run from Nigeria, through the Sahara desert to Algeria. The initial preparatory work is underway. However, in the light of the recent developments in the global gas industry and the collapse of gas prices, the project concept is now under review to determine its viability.

11. My expectation is that this plan will hasten Africa’s integration through trade and migration which has been a priority and central element of the continent’s development strategy. This is more so considering that inter-regional trade within the continent is just about 10%. On our part, we are committed to the integration of Africa’s infrastructure and its development.

12. In the ECOWAS sub-region, appreciable progress has been made. I can safely say that ECOWAS policies on free movement of people and the right of establishment have contributed in no small measures to the increasing success of multi-national companies in the region. Thankfully, PIDA is also aligned to the vision of the ECOWAS community that promotes the free movement of people, goods and services.

13. We thus share the commitment to the full realisation of the Lagos – Abidjan West African road corridor and the Trans – West African Coastal link road. In addition, we are sustaining effort in the development of the gas sub-sector, not only for our growing number of power plants, but in line with the regional initiative of West African Gas Pipeline for the West African market.

14. Distinguished Guests, Ladies and Gentlemen, before I conclude, let me say a few words about some of the domestic initiatives we have embarked on to improve our infrastructure. My Administration has embarked on a number of reforms especially in the Power and Energy Sectors, Road Construction and Infrastructural Development to mention but a few. Just in the last two weeks, my government completed the biggest transfer of power assets in Africa to private investors.

15. By this act, the power sector in Nigeria is now totally privatised, except for the transmission company, which is concessioned to a private firm to manage. Following these critical reforms, we expect an annual US 10 billion investment to follow for the next decade. My Minister for Power, Professor Chinedu Nebo is here as a member of the panel and he will share with you details if you require.

16. To fund our investment on road and rail infrastructure, we have increased our capital expenditure ratio relative to our current expenditure from the national budget by 8% in the last three years, while we have also committed a significant portion of the savings from the reduction in subsidies on petroleum products to expand and improve road and rail infrastructure.

17. As part of the reforms relating to infrastructure, the Petroleum Industry bill (PIB), which seeks to streamline the regulatory oversight of the industry is being considered by our National Assembly, and we expect it to be passed into law during this parliamentary session.

18. In conclusion, I will like to express my gratitude to the World Economic Forum and all the critical stakeholders for supporting Africa’s progress towards the building of 21st century infrastructure across the continent in order to support our future growth. I urge you all not to relent in your efforts.

19. The realisation that we cannot tread this path alone is very clear. I will be pleased to hear at the end of this summit that effective programmes and action plans that include roles for our development partners and international investors have been defined for the infrastructural goals that we have all set, and seek to achieve.

I thank you.