New beginnings: The latest long-term strategy could transform the sector

As the economy expanded rapidly over the past decade, Nigeria’s national transport system became increasingly strained. The country’s road network, which moves 90% of goods and people, according to the Ministry of Transport (MoT), is largely in a state of disrepair and heavily congested. The rail network, meanwhile, is only partially operable due to decades of underinvestment. The nation’s ports and waterways have been operating well above capacity for years, while its air carriers and airports are working overtime to meet rapidly expanding demand. According to the government’s new National Transport Policy (NTP), a draft of which was introduced in 2010, “the Nigerian transport system functions in a crisis situation.” The NTP is meant to serve as a blueprint for the development of the sector for the foreseeable future. The proposal is the most recent entry in a series of ambitious transport planning documents introduced by the government since independence from the UK in 1960. Unlike most of its antecedents, however, the NTP was designed not only to improve upon and expand the country’s numerous transport networks, but also to boost private sector participation throughout the industry, primarily by encouraging companies to enter into public-private partnerships (PPPs) with the government and via the privatisation of state-owned assets. Additionally, the plan aims to improve multimodal transport links, promote the use of public transport and lower prices throughout the system. Provided the government is able to drum up the necessary support and funding to implement the strategy, the NTP has the potential to dramatically improve transport infrastructure and shore up the country’s reputation as a major transport hub in sub-Saharan Africa.

BUILDING ON THE PAST: Nigeria’s government has a long history of transport planning. In 1961 the nascent government hired the Stanford Research Institute, a US-based independent market research organisation affiliated with Stanford University, to look into Nigeria’s national transport network. The resulting study served as a model for the government’s first national transport strategy, released in 1965. The document was made up of a list of broad policy objectives for individual segments. These included identifying new sources of funding for road construction and maintenance; encouraging increased cooperation between corporate shipping agents and the state-owned Nigerian Railway Corporation; seeking new and fruitful maritime arrangements; continuing to subsidise Nigerian Airways, the national airline at the time; and establishing a policy implementation division at the MoT.

A CRISIS: While a handful of the transport policies introduced in 1965 were funded for some time, in general the strategy was mostly ignored. Consequently, transport networks fell into disarray through the 1970s and 1980s. In a report published in 1989, the MoT’s Planning, Research and Statistics Department argued an “urban mobility crisis” had developed. In 1993 the government released another long-term planning document, which outlined a strategy to reduce transport costs and urban congestion, boost accessibility to remote areas of the country and diminish pollution and the high accident rate. The policy, called the NTP at the time (and after which the new NTP is named), generated very little concrete action, in part due to a lack of funding as a result of the entry of a new government.

A decade later, in 2002, in conjunction with the Nigerian Institute of Transportation Technology and Julius Berger Nigeria, a major local construction firm, the MoT launched the Master plan for an Integrated Transportation Infrastructure (MITI) initiative, which laid out a 25-year plan to completely overhaul the country’s transport network. Like its predecessors, the MITI never received enough funding to fully get off the ground.

PROGRESS: While Nigeria’s track record in terms of long-term transport planning is somewhat problematic, specific transport segments have benefitted from various development initiatives over the years, albeit largely on an individual basis. In drawing up the current NTP, the government made an effort to avoid the mistakes of the past. The document concludes with a section on implementation, including an immediate action plan, a short-term action plan and a medium-term action plan. Since the NTP was introduced in 2010, the country has made real progress in a number of key areas. While the government has worked to facilitate increased private sector participation in the transport sector since the mid-2000s, the practice has increased under the NTP. In particular, the MoT and other transport-related agencies are increasingly making use of PPPs to carry out major projects. For example, the federal government recently entered into a $1.7bn PPP to build a new port in the Lagos Free Trade Zone in conjunction with the Lagos State government and the Indonesia-based Tolaram Group.

PORTS: The NTP lays out objectives for each segment. For the ports, the plan includes a number of strategies to increase efficiency and competitiveness in an effort to turn the country into a shipping hub in sub-Saharan Africa. The NTP advocates reorganising the nation’s major ports into independent port complexes in conjunction with a private sector operator; restructuring the Nigerian Ports Authority; and introducing new legislation in support of the port reorganisation effort, among other changes. The plan has similar recommendations for boosting inland waterway efficiency.

RAIL: The rail sector is also expected to expand exponentially under the NTP. Potential changes to the rail system include ramping up private sector participation in an effort to jumpstart development and reduce the financial burden on the federal government; establishing a National Railway Authority to carry out maintenance and expansion work; and linking the network with other modes of transport, particularly ports.

ROADS: The road component of the NTP is the longest and most detailed section. Under the strategy, Nigeria’s road system, which is currently the dominant means of transport, is expected to benefit from a substantial amount of new investment, both from the government and private sector players. The plan lays out a number of ambitious policy objectives, including expanding funding for road development by granting toll road concessions to private investors; establishing a Toll Roads Authority to operate state-owned toll roads; improving road safety; increasing road access to rural and remote areas; levying a number of other road-user charges, including a vehicle tax and a fuel tax; and improving road maintenance and development through the use of PPPs and other similar vehicles.

OTHER OBJECTIVES: The air transport segment is also expected to see improved safety standards and increased investment under the plan. Additionally, the policy includes sections on extending and upgrading urban transport systems in the capital and other major cities; expanding the oil and gas pipeline transport network; updating the overarching regulatory framework for the sector; and improving intermodal transport infrastructure already present throughout the country.