The Cost of Failed Infrastructure On Nigeria Economy

The Cost of Failed Infrastructure On Nigeria Economy

Everywhere you go to in the country, the same cry is taken up by the people from Lagos to Kano, from Kano to Port Harcourt. Inadequate infrastructure makes consumers to pay more on goods and services. The production firms and business entities will tell you that they have right to charge more because they pay more money to buy diesel to power their generator and they pay more money to repair trucks  because of the bad roads.

One business man revealed that in Nigeria , business men pays more to transport goods from the seaports than the money they paid to bring the same goods from Asia or Europe to Nigeria. “Whereas we pay US $50 to ship something from Asia to Lagos, it costs us an additional $150 to transport that same  item from Lagos to Maiduguri. A large portion of that cost results from poor infrastructure”

Another reason why the consumers pay more is the way we carry out operation in our seaport. Until the recent time when a committee to reform Nigeria seaport inaugurated by President Jonathan, Nigeria seaport is the only seaport in the world that doesn’t operate 24 hours services. Cost on goods start mounting the moment the ships arrive. Nigeria ports are jammed because they don’t operate work 24 hours basis. It takes 30-37 days to clear goods in Lagos compared to 2 hours in Singapore.

 The port reform committee inaugurated by the president recently has within is mandate to ensure 24 hours operation and to clear  tankers off Apapa Oshodi expressway;the expressway that leads to Nigeria major seaport. This road has become a nightmare for the road users because of the abandoned petrol tankers along that axis and consequently, property along that axis is losing value as gridlock continues in the area.The committee also saddle with the responsibility of reduction of the clearing days from 37 days to 7 days for now and 2 days clearing target in the future.

Poor infrastructure means that Nigeria runs low-wages and high cost economy. For instance, erratic power supplies forces many firms in Nigeria to operate their own generator. These are not only inefficient compared to centralised power systems, but it also often makes them stand idle. If power  supplying is stable, employers can increase wages with 20-30% because they will save more money and the capital tied up on the sustenance of business in the face of poor infrastructures would be used for business expansion.

If roads are networking with good and motorable condition. The pressures on the existing roads would be minimal and the money which companies pays to tools and machineries due to the bad infrastructure will be used on other things even be chanelled to social responsibilities.

From Olajide Abiodun Shuaib
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