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Road concessioning, the next frontier of possibilities
For decades, Nigeria has professed its ambitious infrastructure development agenda, yet execution has remained elusive. As the saying goes, the road to hell is paved with good intentions. Lofty plans have come and gone, buried under layers of inertia and half-measures.
Now, after years of inaction, the road concessioning initiative is poised to be a game changer.
On March 23, the Federal Government officially flagged off the tolling and concessioning of the 125-kilometre Benin-Asaba Expressway, a critical artery connecting Nigeria’s southern economic hubs. More than just a stretch of asphalt, this corridor is part of the Sagamu-Benin-Asaba-Onitsha-Enugu expressway, the heartbeat of trade and commerce in the region.
The project—fully financed by Africa Plus Partners under the Highway Development and Management Initiative (HDMI)—marks a pivotal shift in Nigeria’s infrastructure financing model.
Since its inception in 2021, HDMI has been ensnared in bureaucratic gridlock and resistance from vested interests. But the tide is turning. The obstacles to investment are being dismantled, and a new era of private sector-led infrastructure transformation is finally taking shape.
Bridging the infrastructure gap
Nigeria’s infrastructure gap is a silent tax on growth, stifling productivity and raising costs across industries. According to the Nigeria Integrated Infrastructure Master Plan, the country has 193,200km of roads, but only 30% (5,960km) are paved. The infrastructure funding shortfall is staggering—$2.3 trillion needed over the next 30 years, or nearly $80 billion annually. Yet, in the past decade, total capital expenditure by both the Federal and State governments have been a mere $60 billion—a drop in the ocean.
The question is no longer whether private sector involvement is necessary—it is how fast Nigeria can optimize its capital stock
Infrastructure concessioning, a game-changer for growth
As John F. Kennedy once said, “The road to prosperity is paved with investment in infrastructure.” Private sector-led infrastructure development is no longer a luxury—it is an imperative. Unlike government spending, which is often plagued by inefficiencies, private investment is driven by performance incentives and structured for long-term sustainability.
Consider the impact – Nigeria loses $29 billion annually to poor road infrastructure. According to the IMF, road quality directly affects economic productivity. Countries with higher mean travel speeds experience higher productivity. While Nigeria’s road speed averages 55km/h, Côte d’Ivoire boasts 74km/h, giving it a competitive edge.
With the Benin-Asaba Expressway concessioning agreement, travel time will be slashed by 67% to 1 hour from 3 hours. With the reduction in the price of petrol (N860 per liter) and diesel (N1020 per liter), this will boost productivity, reduce logistics costs, and improve the ease of doing business.
Even more significantly, as private capital takes over infrastructure financing, public funds can be reallocated to social sectors—healthcare, education, and poverty alleviation.
A defining moment for Nigeria’s development
We have seen the size of Nigeria’s economy plummet to nearly $200bn from about $570bn a decade ago, and its share of Africa’s GDP plunge to 6% from its giant’s share of 22%. The road to recovery is clear – investment—particularly in infrastructure.
HDMI is not just about roads – it is about breaking free from the cycle of underinvestment and unlocking the full potential of private capital. This is a turning point—a chance to reset the trajectory of growth. As the old proverb rightly puts it, “A journey of a thousand miles begins with a single step.” The first step has been taken—what happens next will define Nigeria’s future.
Mr. Bismarck Rewane, the CEO of FDC, explored the transformative impact of HDMI on Nigeria’s infrastructure landscape on Channels Television’s Business Morning.
Watch the full discussion in the attached clip!
Enjoy your read!
