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World Bank’ll restrict support to vital sectors — Marie-Nelly

By BusinessNews Staff on January 13, 2014

The World Bank Country Representative in Nigeria, Marie-Francoise Marie-Nelly, in this interview with EVEREST AMAEFULE, says the bank will limit its intervention in Nigeria to the power and few other sectors in order to make more visible impact

Why has the World Bank shifted its attention to the states, away from the federal projects? Is this an indictment of the Federal Government?

It is not an indictment. We are working with the Federal Government also; we actually have a few important initiatives at the federal level. For example, we just approved $200m to help in establishing mortgage financing facility which will be an important institution for the housing market in Nigeria. This is really a federal institution that will of course serve the various states. The communities where we are working are in the states. In that sense, under the purview of the federal ministries, we engage more with states because this is really the way the Nigerian structure is organised.

You know that we have a number of projects at the state level. These projects should be embedded in the strategies of the states. This is because the contribution of the World Bank and indeed the development partners is quite small. So, we want to be catalytic in our demonstration. In fact, when we say there is an issue of counterpart funding, our money should be the counterpart funding. The main resources should come from the states. We want our activities to be closer to the beneficiaries. We also want to help to strengthen the capacity of the states to manage the resources; after all, the states get about 50 per cent of the resources.

Are you saying the resources in the country are not being well managed?

We have not said that, we are achieving more results. We are here to assist what the country is doing. Our attention is on World Bank resources and not on government resources. But what are trying to say is that because our intervention is catalytic, we want to see gradually that the types of programme that we are involved in are taken over by the states. Let me give you a concrete example. In the case of the community social development programme we are supporting, we see now that a number of states are not only paying their counterpart funds to the programme, they are putting in their own resources. The government of Cross River States, for instance, has said that it has committed N1.1bn to implement the activities in the state. So, clearly, the idea of having demonstration effect can really be catalytic, not only in leveraging government resources but also showing how to do things; to share our knowledge – what we do in Nigeria and how we replicate initiatives. We also bring in global knowledge; not just the financial resources but to see how the governments can take advantage of it and then use it when they apply their own resources. And there are good examples of that.

Let me take another example in this area. The government wants to strengthen the social safety net system – basically, having instruments to protect the most vulnerable. To start it, last year, at least 15 states went on a study around the world. They went to several countries in Africa (including Rwanda, Ghana and Kenya) and Brazil. Now, there is a programme that is called the youth and social employment programme – a Nigerian programme that is benefiting from inputs from these various countries.

Your statistics show that 1.2 billion people in the world are living in extreme poverty and 100 million of them are in Nigeria. The figures seem to be disproportionate and quite high for Nigeria. Why is this so?

Nigeria is a large country. It has a population of almost 170 million people. So clearly, even if you have the same ratio of the poor as other countries, the absolute number will be higher and I think this is really the challenge for Nigeria. We need to do clearly more. The Nigerian number translates to 8.3 per cent of the total population of people living in extreme poverty in the world. Yes, but what I am saying is that in a number of areas, because of the size and the significance of Nigeria, as a matter of fact, whatever you take to compare Nigeria with the rest of the world, it will be significant. This is because Nigeria is an important country on the continent by its size and its activities. In fact, what you do is visible and what you don’t do is also visible in the same way. I think what is important is to encourage the government in what it has started to do; to attack poverty with programmes like YOUWIN to create opportunities for the youth. The government is also pushing the privatisation of power. Everybody is saying in order to have activities that touch everybody, you need power. I think that is what matters – acknowledging that there is a problem and at the same time seeing what is being done about it. I think we are encouraged by the steps government is taking but we think that it needs to be scaled up. We think that everybody needs to work much faster and harder, including what we at the World Bank are doing in Nigeria.

How will the World Bank scale up its activities in Nigeria?

We are going to be concentrating our activities in fewer sectors. We are going to do much more in power. At the moment, we have a portfolio of about $200m in the power sector and facilities to provide for guarantees. We will help in the next two to three years to provide about $1.4bn investment in transmission.

Also, as World Bank, we want to play this catalytic role to bring resources from our private sector arm, the International Finance Corporation, and leave it to the private sector because even if we are to use all the resources we have for Nigeria in power, it will not be sufficient. So, that is one area we are going to scale up.

We are looking at areas that are going to create jobs. We are also looking at the agriculture transformation agenda. We think that if efforts are sustained in increasing the production including the value-added, we cannot only have benefit for the Nigerian economy but also for export. Here, our intervention may be small in quantity but we want to have a demonstration effect. We intend to focus our attention on two export processing zones where the government wants to focus on the intensification of cassava and rice. We intend to focus on Kogi and in the Kano areas and we believe that if our intervention is critically organised around that, we should have stronger results and have the possibility of scaling them.

We are in the process of supporting an irrigation programme that helps to improve the access to irrigative land in the magnitude of hopefully 60,000 hectres in the next five to six years because you need time to rehabilitate the dams. Again, this is a place we hope in 10 years, we can have some significant results.

The third one where we want to concentrate our intervention is the promotion of Small and Medium Enterprises; provide access to financing because this is one of the most critical challenges that have been raised by private operators in doing business. We think that helping with some instruments like the one that we have for the housing and mortgage financing will allow people to have access to loans to buy houses; there will be opportunities for more construction. In some sense, looking at the sector both from the demand and supply sides, it is something that we want to support.

By what percentage will the World Bank portfolio increase in the next few years?

What we are saying is that Nigeria is now moving to a new status. Nigeria will be able to continue to benefit from the International Development Association window and will benefit from the IBRD window. We think that this will certainly increase the resources for the country. Now, we have an average of about $1.2bn new commitments per year. We hope that with that we can move to $2bn and later to 52.5bn per year. I think that the scaling that we are thinking about is more in terms of focusing our intervention on fewer sectors. But as I said, instead of putting $200m in power, we’ll put in N1.5bn. Then, our engagement will be more visible. We hope that by supporting the private sector that will deepen power production in the next two to three years; we hope that the private sector itself can bring up to 900 megawatts of power in the country. So that is what we are talking about in scaling up – putting more resources in fewer sectors in an integrated manner. Power sector is one; agricultural transformation is another.

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