Sanwo-Olu: A face of investment drive in Nigeria’s public sector

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Lagos State Governor, Mr. Babajide Sanwo-Olu,

…Analysis of his PPP’s model

By Moses Adeniyi

The onus on Lagos as the nerve centre of investment in Nigeria demands that nothing but seasoned navigations  must be employed pragmatically and strategically to maintain its status as the economic hub of the Country. Lagos remains the fifth largest economy in Africa and Nigeria’s economic nerve centre. The thrust that keeps the sustenance of this profile would demand not only creative insight to the framework of the  ecosystem of economic realities, but also navigating the dynamic patterns with sensitive brilliance to exploit qualitative values, against falling victim of the strains.

The fact remains that for anyone who would steer the helm of Lagos, for the State to not only maintain its status, but also expand its growth steadily, would have to have a firm grip on the understanding of how economy works and how to deploy key instruments with strategies to gain rather than lose.

At a time Nigeria is suffering harsh economic conditions, submissions on how the nation’s economy can be salvaged have been plethora as the burden of macroeconomic dynamism has place the Government on pressure, recently. The strategies to pull out of the mire of unfavourable economic conditions have become of national concern.

For Lagos as the economic nerve centre, the demands are particularly high. Nonetheless, it has remained that the State against all odds of recent economic strains, have maintained its status, and is rather growing than falling.

Not taking the analysis to far into history, giving cursory evaluation of economic indications under the over three years of the Governor Babajide Sanwo-Olu led Administration would suffice to give insights into the path that has sustained the economy amidst recent odds of global economic strains.

For Lagos, one resounding approach of Babajide Sanwo-Olu, as a nucleus to sustainable economic growth, has been the thrust of Public Private Partnership (PPP) which has formed the navigating impetus of his economic strategy.

It is glaring that emphatic focus on public sector driven economy by majority of States in the Federation, has not spared them from deficiencies, and the inefficiency of such reliance have left economies,  particularly of subnationals, with crawling growth.

The penetrating drive of PPP as the centre drive of the Sanwo-Olu’s model of macroeconomic ecosystem appears to be paying off as a system built around robust private sector partnership and participation.

Key offices of the State having to do with investments have had to undergo structural reorientation to bear reflections of this PPP framework. The Office of the Lagos Global took a developmental metamorphosis with the operations of those of the Sustainable Development Goals and Investment and more specifically, the Lagos Public-Private Partnership (PPP) office which acts as a coordinating centre for Public-Private adventures.

On the path of the Governor  Sanwo-Olu led Administration, it is glaring that investment has remained a centre course of the Administration’s impetus.

Records

Reports have shown Lagos recorded 71 per cent of Nigeria’s $1.5 billion foreign direct investment (FDI) in Q1 2022. The indicator reflects the booster of strategies deployed to make the State investment friendly by eliminating bottlenecks in business processes in the State.

Growing small businesses has been a strategic impetus driving the Sanwo-Olu led Administration with records reflecting the State Employment Trust Fund has supported no less than 3,673 businesses with the sum of N1.56billion as grants and provided mentorship and business advisory to young people to start and grow their businesses.

At the Lagos Chamber of Commerce and Industry (LCCI)/Lagos Economic Summit Group (LESG) Private-Public Partnership Pre-Ehingbeti Stakeholders Engagement, with the theme: “Building a Sustainable Future for a Greater Lagos,” in Lagos, Sanwo-Olu represented by his Deputy, Dr. Obafemi Hamzat, had disclosed that the State Government has also supported 1,835 small businesses with N985 million which has led to the creation of 10,500 direct jobs in the state, just as the Government has also invested N1billion into Agricultural Value Chain businesses to provide food and create jobs in the State.

Engagement

Critical engagements with stakeholders have been known to be a centre of attention in the strategic approach with action plans which have proven veritable. The State’s Commissioner for Finance, Dr. Rabiu Olowo had disclosed last month that the Administration had fulfilled about 90 percent of the action plans from the last Ehingbeti Summit which will be reported during the forthcoming Summit slated for 11th to 12th October 2022.

The Lagos State Employment Trust Fund and Lagos State Security Trust Funds are key products of critical engagement with stakeholders which have proven their worth on investment and security in the State.

PPP driven projects

Sanwo-Olu’s Administration has strategically built on such projects as the Ikoyi Link Bridge, BRT Project, the Red and Blue Rail Project which will commence operation soon, the Lagos Free Trade Zone and the Imota Rice Mill amongst many others, leveraging PPP arrangements.

The Lagos Rail Mass Transit has been structured by the Babajide Sanwo-Olu led Administration with the blend of PPP drive for a rapid transit system.

The brilliance of Sanwo-Olu to investment appears to be of seasoned dimension in strategic penetrations evoking private partnership. The emphasis has been resounding on sectoral developmental courses.

From industry, information and communication technology (ICT), agriculture, MSMEs to security, the reflections of the model, driving growth by PPP have been resounding.  Evaluation of growth along these lines have been appreciable on the stretch of positive records.

Rail

The Blue and Red line rail projects have attested to key investment with construction which have gone far way, near completion. Such investment appears to be rare by any subnational in Nigeria. Rail Mass Transit project which has suffered set back before the Sanwo-Olu led Administration has been awaken with the Red and Blue lines slated for commissioning and operation soon.

Lagos Government will be delivering two rail mass transit projects within the first term of the Sanwo-Olu administration. The Blue Line, which traverses between Mile 2 and Marina, will be operated on Electric Motor Unit (EMU); the 37-kilometre Red Line, from Agbado to Ebute Metta, will operate on Automotive Gas Oil (AGO).

At the launch of the last track beam (T-beam) of the 27-kilometre Lagos Blue Line Rail Mass Transit in August,   Sanwo-Olu while personally flagging off the engineering procedure held at the site of the Marina station of the rail project reiterated again, the commitment of the Lagos Metropolitan Area Transport Authority (LAMATA) and the contractor to the December deadline for the Blue Line project’s completion.

With the laying of the final T-Beam, this means all difficult civil works standing in the way of the Lagos Blue Rail Line, which started in 2012, have been overcome. The contractor – China Civil Engineering Construction Corporation (CCECC) – will now go ahead to set the rail tracks along the alignment and move the project to completion.

Speaking at the launch of the last T-Beam on the Blue Line, Sanwo-Olu had said the achievement reflected his Administration’s commitment to bringing succour to Lagosians and give them choices in mass transportation.

Sanwo-Olu had mentioned the rail projects represented the audacity of his Administration’s vision to deliver a robust integrated transit system as encapsulated in the Traffic Management and Transportation pillar of his Government’s T.H.E.M.E.S. development agenda.

“Today’s final T-beam launch indicates that we are gradually inching to the completion of the civil infrastructure for the first phase of the Blue Line traversing from Mile 2 to Marina. The engineering work today completes a total of 1,967 piles foundation, while we have also completed three 306 platforms, 310 piers, 267 cover beams and erection of 984 T-beams.

“We are not just making promises; people are beginning to see for themselves that all the milestones and the difficult tasks we are meant to achieve to ensure operation of the Blue Line are being achieved. The Marina Station, which is the iconic terminal for the Blue Line, will be completed within two-and-half months. I am restating here that we will formally complete this Blue Line before December 31, 2022,” he had said.

Sanwo-Olu had said the two sets of EMU coaches already procured for the Blue Line operations would arrive in Lagos from China before the end of October. He had said the rail line would be test run immediately after completion, while passenger movement would start within the first quarter of 2023.

Sanwo-Olu disclosed the construction of the second phase of the Blue Line project would commence after the start of operation, which would extend the rail project from Mile 2 to Okokomaiko.

He had said Blue Line stations would be built at Festac, Alakija, Trade Fair, Volkswagen, LASU and Okokomaiko disclosing that talks were being held with the Ogun State Government for possible extension of the rail line to Agbara.

“The second phase of the Blue Line project will be an easy infrastructure to develop because the marked alignment for stations and tracks are largely at grid level. While we are at this, the Red Line is also on the way. This is a start-and-end project for our administration, with about seven stations concurrently being built. This will redefine mass transportation in Lagos.

“To our citizens, I say the Blue Line is for real and you will ride on it in no distant future. For the Doubting Thomases and people that do not like our face, their eyes cannot disbelieve in the infrastructure we are bequeathing to the citizens of our State. They cannot disbelieve in our bold effort and commitment to improve mobility and deliver transport infrastructure that brings ease to our people,” he said.

A new development breathe into the investment on rail took shape when late September, the Lagos State Government achieved another major milestone in its determination to deliver the operation of the Red Line Rail System by the first quarter of 2023.

A statement by the Commissioner for Information and Strategy, Mr. Gbenga Omotoso, disclosed the TALGO SERIES 8 Trains acquired for the Red Line have finally arrived in Lagos, saying “The 2 Nos. Ten and Eleven Car trains which were bought from Milwaukee are here.”

He explained that it was necessary to decouple the train into 21 individual cars for effective transportation to Lagos, adding that the trains will be recoupled with the help of rolling stock Engineers from Talgo, the company that manufactured the trains in the United State of America.

Omotoso had said, “The Engineers will also take the opportunity to train our local Engineers whilst they are here to equip our young people with the requisite skills. Once the recoupling is complete, the testing and commissioning will commence followed by full passenger operations in the first quarter of 2023.

“Each train can carry 1,500 passengers and is expected to run on the Red Line Rail from Agbado to Oyingbo, with the journey taking less than 30 minutes,” the Commissioner had stated.

Other key brilliant investments structured on PPP model include the Lekki road concession, and the $2.1billion Fourth Mainland Bridge project.

Also, is the development of a Medical Park on Awolowo Road, aimed at the transformation of the old School of Nursing. The full development of the Medical Park on completion would address the issue of medical tourism, creating in the State a hub of quality health care delivery, with the focal point of attracting investment back into the State and the country at large. Housing projects, including the N3 billion Ilubinrin projects, also about 8000 bed spaces in six blocks in the Lagos State University (LASU) for accommodation, among others, are structured on PPP.

The push of such sort of huge investment cannot be justifiably driven amidst the insufficiency of public funds.

A key investment with future appeals include the laying of 6,000km fibre optic cable projects, with the first phase of about 3000 kilometers nearing completion.

Foresight

It is apparent Sanwo-Olu’s economic perspective would not be short lived, but is of far reaching impacts with long term insight.

The blueprint for another 30-year journey in pursuit of physical development, social growth and economic prosperity, has been drafted as gathered. Sanwo-Olu in June, 2022, while speaking on this to business leaders and the organised private sector at an interactive meeting, disclosed the Lagos State Development Plan 2052, will be officially rolled out at the forthcoming 9th Economic Summit of the State – Ehingbeti. The 30-year plan, according to him, was developed with clear objectives from four strategic dimensions aimed at positioning the State to achieve its vision.

The meeting, held in Lagos was at the instance of the Lagos Chamber of Commerce and Industry (LCCI). It was also attended by members of the diplomatic community. Established in 1888.

Sanwo-Olu had hinted that each of the four dimensions in the development plan would be achieved through over 400 policy initiatives that would be implemented throughout the period.

“The Lagos State Development Plan 2052 has been developed with a set of clear objectives across four strategic dimensions, which are to position Lagos on the track to achieving its vision. The dimensions to this plan are to keep a thriving economy that will make Lagos a robust, healthy and growing economy with adequate jobs and strategic investments to sustain growth. We are building a human-centric city in which every Lagosian will have access to affordable and world-class education, healthcare and social services.

“There will be deliberate effort to keep modernising our infrastructure, by providing reliable and sufficient infrastructure that meets the needs of a 21st century city. The plan will also bring about sustenance of effective governance. Lagos will have a supportive and enabling environment that creates opportunities for all Lagosians.

“This is a huge task that must be achieved between now and the nearest possible future,” he had said.

Sanwo-Olu believed the plan would not be realised when the private sector – the drivers of the State’s economy – is not carried along in the implementation of the identified policy phases.

In the last one year, Sanwo-Olu had said Lagos had recorded massive influx of Foreign Direct Investment (FDI) up to the tune of $750 million in the technology sector, attracting global tech brands, such as Equinox, Google, and Microsoft, among others. This, he said, is complementing the rollout of metropolitan fibres by the State Government to promote e-commerce, traffic management and improve security.

The 30-year developmental plan has attracted vote of confidence among private stakeholders.  In September, at the Lagos Chamber of Commerce and Industry (LCCI)/Lagos Economic Summit Group (LESG) Private-Public Partnership Pre-Ehingbeti Stakeholders Engagement, the President of the Lagos Chamber of Commerce and Industry, Dr. Michael Olawale-Cole, represented by the Deputy President, Mr. Gabriel Idahosa had stated that the decision of the Lagos State Government to collaborate with the Chamber on the 30-year Development Plan reflects government’s appreciation and recognition of the Organised Private Sector in the realisation of the socio-economic objectives of the State and Nation in general. He, therefore, assured the State Government of the support of the Lagos Chambers of Commerce and Industry in ensuring the effective implementation of the State Development Plan, promising to enlighten the business community about the opportunities and benefits inherent in the plan and why they should be part of it.

The PPP model of Sanwo-Olu appears to be vitalising as recent report proves the State’s GDP has gone up by $5billion to about $145.141billion, while budget has doubled to about N1.7trillion.

Wooing investors recently in September, when he met a group of potential investors in New York on the sidelines of the 77th session of the United Nations General Assembly at a roundtable organised by the Business Council for International Understanding (BCIU) at Park Lane Hotel in the heart of the city, Sanwo-Olu while reeling off his administration’s achievements in the past three years convinced the potential investors using firm economic indices. According to him, with a GDP growth trajectory to $145.141billion, the time is favourable for investors to take chance in Lagos.

According to him, the rolling stocks for the Red Line, which his Administration started, he said, are on the way to Lagos and work is going on as scheduled on the stations and the overpasses that will ensure a good transportation experience. There are about four other lines to be built for the State to be covered by rail, so as to ease the pressure on roads.

He spoke of opportunities in water transportation, saying from seven ferries, the state’s fleet has risen to 21, besides many others run by private operators. “Investors can double the fleet,” Sanwo-Olu said.

Many of the 15 jetties being built by the State are ready for commissioning, he added, stressing that the aim is to have an integrated urban transportation system, strengthened by a strategic road infrastructure, such as the Lekki-Epe Expressway and the Fourth Mainland Bridge, which has attracted many investors, among which one will be chosen before the end of the year 2022.

The State, said the Governor, plans to build an Infectious Diseases Research Centre to tackle health challenges, such as COVID-19. Over 1000 school projects have been completed and “we have introduced technology to make teaching and learning an exciting experience. We are seeing the results. We used to have about 36% pass in School Certificate Examinations; now we have about 80%. We are opening brand new schools and introducing technology by giving teachers tablets to aid their job,” he had said.

He spoke about the 6,000 km fibre optic cable being laid around the state, saying the first phase of 3,000 km was almost completed. This, he said, will aid faster and cheaper internet connectivity, thereby boosting service in hospitals and schools, besides boosting the impressive activities of the youth in the tech ecosystem.

Sanwo-Olu described Lagos as the “entertainment capital of Africa.” He cited the recent Headies Awards in Atlanta and added that a Film Village was on the way. He mentioned opportunities in housing and assured would-be investors of “the sanctity of contracts,” with the state appointing new judges to aid smooth operations of the Judiciary.

With brilliance on how to turn challenges to opportunities, Sanwo-Olu spoke of challenges, such as refuse disposal, enlightening the potential investors about 4,000 metric tons generated daily, as attractive opportunities to investors, who are willing to turn waste to wealth – a path the state is willing to tread. Challenges in water, power and other sectors, were areas he opened up for intending investors to exploit.

In his words, capturing Sanwo-Olu’s grip on investment drive,  the Managing Director (Africa) of McLARTY Associates, Amb. (ret.) Terence P. McCulley, said of Sanwo-Olu “people who have returned from Lagos have spoken of how they no longer recognise the state because of the developments taking place there.

“You can be the ambassador of the private sector to the Federal Government, providing an enabling environment for manufacturing, agriculture and technology, which are drivers of diversification.”