Privatisation Attracted $7.8bn Investment in 18 Years – BPE

Nigeria investment
  • Privatisation Attracted $7.8bn Investment in 18 Years – BPE

The Federal Government generated a total of $7.8bn Foreign Direct Investment from the sale of 53 publicly-owned companies in the last 18 years, the Bureau of Public Enterprises has said.

The Director-General, BPE, Mr. Alex Okoh, who stated this at a press briefing in Abuja on Thursday, also ruled out the sale of the Nigerian LNG Limited.

Okoh, who said Nigeria could finance its development programme through privatisation instead of borrowing, stated that the privatisation agency handled the reform of 152 enterprises within a period of 18 years.

The BPE boss said two power firms, Afam Power Plc and Yola Electricity Distribution Company, would be sold between December this year and January 2019.

He noted that the privatisation of public enterprises was expected to contribute N400bn to the funding of the 2018 budget, but ruled out the sale of the NLNG as the company was paying the government huge dividends.

According to the BPE helmsman, about 36 per cent of the public enterprises that have been privatised have not been successful as a result of a number of reasons, including policy distortions and macroeconomic instability.

Okoh said, “From 1999 till date, the BPE has successfully reformed (by way of privatisation, commercialisation and, in some cases, concession) a total of 152 public enterprises.

“Through its privatisation and commercialisation programmes, the BPE has attained some broad milestones in the past 18 years.”

Speaking on the Afam Power Plc, Okoh stated, “With installed capacity of 976MW and a potential to immediately add about 110 megawatts to the national grid, this initiative will have a very positive effect on power generation.”

An attempt to privatise Afam Power Plc along with other power firms carved out of the defunct Power Holding Company of Nigeria Plc failed, while the buyers of the Yola Electricity Distribution Company had declared force majeure in order to give up the running of the firm as a result of the activities of the Boko Haram terror group.

Okoh listed other public enterprises to be privatised to include the concession of the Terminal B of the Warri Old Port and the restructuring, recapitalisation and sale of the Bank of Agriculture.

Others are the partial commercialisation of the Nigerian Postal Services, partial commercialisation of four River Basin Authorities and the re-concession of the Lagos International Trade Fair Complex.

Answering questions from journalists, Okoh said conflicts between the privatisation agency and the Infrastructure Concession Regulatory Commission were uncalled for as the law was clear on what each of the organisations should be doing.

He stated, “There is a difference between assets concession transaction management and concession regulation. Everybody should understand their roles and play them instead of causing confusion in the market.

“Infrastructure gaps in the country need $100bn to fix in the next 30 years. How can we attract investment to the market where there is confusion? Capital flows into economies where there are certainties.”

Answering question on the Aluminium Smelting Company of Nigeria, Okoh said although the Supreme Court ruled in favour of the core investor, the BFIG, the group could not make 10 per cent payment as required by the transaction process when the ALSCON was offered to it following the court ruling.

He gave an assurance that efforts were on to ensure that the company returned to operation very soon following a reversion to UC Rusal.

Asked to name the enterprises that could be sold instead of the government resorting to borrowing, Okoh said the refineries were among them, but added that it was good that the government was rehabilitating the plants so that they would not be sold as scraps.

About the Author

Samed Olukoya
Samed Olukoya is the CEO/Founder of investorsking.com, a digital business media, with over 10 years' experience as a foreign exchange research analyst and trader. A graduate of University of East London, U.K. and a vivid financial markets analyst.

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