FG Announces Major Highway Concessions to Boost Economic Growth and Infrastructure

In a groundbreaking move set to transform Nigeria’s road infrastructure, the Federal Government has unveiled plans to concession major highways through the Highways Management and Development Initiative (HMDI). This strategic step aims to improve the country’s road networks while driving economic growth. The announcement was made by the Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, during a virtual dialogue meeting in Abuja on Thursday.

Transforming Nigeria’s Economy: Key Highlights from the Announcement

1. Highway Concessions for Better Infrastructure: The core focus of the Highways Management and Development Initiative (HMDI) is to concession critical highways across the country. The initiative aims to improve Nigeria’s road infrastructure, boost transportation efficiency, and foster long-term economic development.
2. Economic Growth on the Rise: Edun provided an optimistic outlook on Nigeria’s economic progress, stating that the country’s economy grew by 3.84% in the final quarter of 2024, surpassing the 3.4% annual target. This growth follows a period of fiscal instability, during which Nigeria avoided collapse after relying on excess, illegally borrowed central bank funds.
3. Declining Inflation and Cost of Living: In a positive turn, inflation has started to ease, with a 1.3% reduction recorded between January and February 2024. Food inflation is also showing signs of decline, while the cost of petroleum and energy has decreased, further improving economic conditions for Nigerians.
4. Stabilization of the Exchange Rate: Another major development highlighted by Edun is the stabilization of the exchange rate. This has led to lower costs for imported goods and services, benefiting key sectors like healthcare and education.
5. Positive Trade Balance and Revenue Growth: The country’s balance of trade has shifted to positive territory, and government revenues saw a significant 20% increase in 2024. The reduction of the budget deficit and lower debt servicing costs have also contributed to an overall improvement in the nation’s living standards.
6. Private Sector Investment and Technology Adoption: Edun emphasized the government’s focus on stabilizing the economy further and creating an environment conducive to private sector investment. He stressed the importance of using technology to enhance revenue generation from government-owned enterprises.
7. Tax Reforms and Infrastructure Plans: In line with its broader economic strategy, the government is introducing a tax reform bill that will raise the top-end personal income tax rate from 18.6% to 25%. Edun highlighted agriculture, housing, and infrastructure as key drivers of future economic growth, with plans for a 25-year low-interest mortgage scheme to address the housing deficit.
8. Shifting Financing Models: The government is also transitioning from concessional and bilateral financing to more sustainable and affordable funding methods, including domestic bond issuance.
9. Commitment to Pensioners: The government reaffirmed its commitment to addressing the long-standing legacy debts owed to pensioners, with over N700 billion already issued in bonds for pension payments.

A Future of Growth and Investment:

Despite Nigeria’s ongoing reliance on oil revenue, Edun made it clear that the government is committed to creating a safer and more investor-friendly environment for the oil sector. He emphasized maximizing fossil fuel revenue while also encouraging public-private partnerships and joint ventures to boost investment across various sectors.

“Now is the time for equity, revenue generation, and private sector participation, both domestically and internationally,” Edun concluded, signaling a new era of economic revitalization and infrastructure development for Nigeria.

This latest announcement marks a pivotal moment for Nigeria, as the government sets the stage for more dynamic growth, improved infrastructure, and a stronger, more diversified economy.