Six companies will construct 19 federal roads covering 794.4km under the new Executive Order 007 signed by President Muhammadu Buhari on Friday.
The Minister of Finance, Zainab Ahmed, listed the roads at the signing ceremony inside the council chamber of State House Presidential Villa.
She said the Executive Order #7 of 2019, titled Road Infrastructure Development and Refurbishment Investment Tax Credit Scheme, is the outcome of efforts to think outside of the box and deploy new techniques to develop critical roads infrastructure in the country.
She said the scheme will incentivise private sector investment in Nigerian roads across key economic corridors and industrial clusters, relieving the government of the burden of funding the initial outlays for these investments.
“Participating investors will use tax credits to reduce corporate taxes payable to government until they recoup the value of their investments in roads and bridges.
“Essentially, this scheme will utilise tax expenditures, refundable by way of tax credits, to finance the construction of critical roads infrastructure through a Public Private Partnership mechanism,” she said.
The minister also said Mr Buhari is empowered by Sections 5 and 315 of the 1999 Constitution to make Executive Orders to alter, repeal or otherwise modify existing laws.
She said relevant provisions of the Companies Income Tax Act also empower him to authorise the exemption from corporate taxation, for certain companies or groups of companies, by way of the issuance of tax credits.
Mrs Ahmed said the new scheme is based on the demand for road projects by companies and other corporate sponsors, who are willing to deploy their own working capital and financial resources to fund road projects located in the major economic corridors of the country where they have significant businesses and operations.
“In this pilot phase, the following six private sector companies have chosen to participate in the Scheme:
a) Dangote Industries Limited;
b) Lafarge Africa Plc;
c) Unilever Nigeria Plc;
d) Flour Mills of Nigeria Plc;
e) Nigeria LNG Limited; and
f) China Road and Bridge Corporation Nigeria Limited.
“These investors will be investing in the following 19 eligible road projects, totalling 794.4km which have been prioritised in 11 states across each of the six geo-political zones:
a) Construction of Ashaka-Bajoga Highway in Gombe State;
b) Reconstruction of Dikwa-GambaruNgala Road in Borno State;
c) Reconstruction of Bama-Banki Road in Borno State;
d) Rehabilitation of Sharada Road in Kano State;
e) Rehabilitation of Nnamdi Azikiwe Expressway / Bypass, in Kaduna State;
f) Reconstruction of Birnin Gwari Expressway – Road in Kaduna State;
g) Reconstruction of Birnin Gwari – Dansadau Road in Kaduna State;
h) Reconstruction of Makurdi-Yandev-Gboko Road in Benue State;
i) Reconstruction of Zone Roundabout-House of Assembly Road in Benue State;
j) Reconstruction of Obajana-Kabba Road in Kogi State;
k) Reconstruction of Ekuku-Idoma-Obehira Road in Kogi State;
l) Construction of AdaviEba-Ikuehi-Obeiba-Obokore Road in Kogi State;
m) Rehabilitation of Lokoja-Ganaja Road in Kogi State;
n) Ofeme Community Road Network and Bridges in Abia State;
o) Rehabilitation of Obele-Ilaro-Papalanto-Shagamu Road in Ogun State;
p) Reconstruction of Sokoto Road in Ogun State;
q) Reconstruction of Apapa-Oshodi-Oworonshoki-Ojota Road in Lagos State;
r) Construction of Bodo-Bonny Road & Bridges across Opobo Channel in Rivers State; and
s) Rehabilitation of Benin City – Asaba Road in Edo State”.
The finance minister said the government is still soliciting for more serious proposals from interested Investors, state governments and others who may wish to take advantage of the scheme to partner with the federal government in investing in roads.
“Our intention is for there to be at least one significant eligible road project underway in every state of the federation within the first year of the operation of this scheme.
“In terms of process and governance, prospective road projects are to be submitted to the government via the scheme’s management committee.
“This management committee, which I chair, has the Minister of Power, Works and Housing as its Deputy Chairman, and the Permanent Secretary of the Federal Ministry of Finance as its Secretary.
“The other members of the management committee are drawn from a number of relevant federal Ministries, Departments and Agencies (‘MDAs’),” she said.
She identified representations from the MDAs to include:
a) The Federal Ministry of Finance;
b) The Federal Ministry of Power, Works and Housing;
c) The Federal Ministry of Industry, Trade and Investment;
d) The Federal Ministry of Justice;
e) The Bureau of Public Procurement;
f) The Federal Inland Revenue Service;
g) The Nigerian Investment Promotion Commission;
h) The Securities and Exchange Commission;
i) The Infrastructure Concession Regulatory Commission;
j) The Budget Office of the Federation;
k) The National Bureau of Statistics;
l) The Nigeria Sovereign Investment Authority; and
m) The Office of the Chief of Staff to the President.
Mrs Ahmed said after carefully considering submissions by investors, the management committee will forward the proposals, through the chairman of the committee, to the president.
She said Mr. Buhari will, based on the new Executive Order, select eligible road projects which will be published in an official gazette.