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FDI to Nigerian Construction Industry to reach $ 9.4 billion by 2021 – Business Monitor Int’l

By on May 16, 2012

INVESTMENT inflow into Nigeria’s construction industry is expected to reach $9.4 billion (N1.5 trillion) by 2021, Business Monitor International, has said in its first quarter report of 2012.

In a report released recently by the UK based company indicated that investment continued to flow into the Nigerian construction sector as low inflation encouraged growth levels.

According to the report, revised figures indicated that year-on –year growth will be 9.5 per cent for 2012, adding that the growth trend will continue till the end of the forecast period in 2021.

The international agency predicted that Nigeria’s construction industry will witness an investment value of N 3.3 billion in 2012, trebling to $9.4 billion by 2021.

The report stated: “Nigerian infrastructure development company Bi-Courtney Highway Services (BCHS) has announced that it is to begin its redevelopment of the Lagos-Ibadan Expressway at the Ibadan end. The $559 million project involves the reconstruction of both existing carriageways, as well as the addition of two more carriageways in each direction between the Lagos-Sagamu interchange. BCHS has been awarded a 25-year concession contract to manage the expressway, which links Lagos with Nigeria’s western states.

“The government of the Nigerian state of Akwa Ibom and Messrs ALCON Nigeria Limited have entered into a N18.05 billion ($114million) construction contract in Nigeria, which includes the development of an international terminal at Ibom International Airport. The airport started its commercial operations on September 29 2009 and has so far handled a total of 403,663 passengers. The project is scheduled to be completed in 24 months.

“Intels Nigeria was awarded a contract by the Nigerian government for Phase 4 of the Onne Port Complex at Port Harcourt in Rivers State. The US$370.5mn project includes land reclamation, the widening of the channel entry, the construction of three new berths at the Federal Ocean Terminal, and the enhancement of existing facilities at the port. Intels, which has already completed the first three phases of the project, will undertake the work in order to allow the port to handle an increase in gas and oil shipments.

“Nigeria has been rocked by a sharp increase in violence perpetrated by militant Islamists and retaliatory forces, which threatens to escalate if not contained. Meanwhile, the removal of fuel subsidies has spurred nationwide protests, including a general strike, putting immense pressure on the government. The country will need to press ahead with ambitious economic and business environment reforms and develop a plan to address the root causes of violence in the Niger Delta and the Middle Belt”.

The research body stated that it expect Nigeria to continue to experience strong economic growth, bolstered increasingly by investment and the consumer sector. While significant hurdles will need to be surmounted, we expect that, overall, 2012 will be an improvement over the growth seen in 2011.