The pressure on the naira in the foreign exchange market, and the removal of fuel subsidy have taken a toll on earlier projections on what the Federal Government would require to complete inherited ongoing road projects nationwide.
The Minister of Works, Engr. David Umahi, who disclosed this at a briefing yesterday, said President Bola Tinubu’s administration would now require over N19 trillion to get the job done.
The new cost represents an increase of N3 trillion over the N16 trillion projected for the projects as at August, 2024.
Umahi had at a briefing on August 23rd said: “The funding gap to complete all the inherited projects is about N13 trillion as of May 2023; that will be more than N16 trillion when all projects are reviewed in line with current market realities. This is due to the removal of fuel subsidy and floating of the naira”.
While addressing the media yesterday, the minister explained that these issues had continued to have an impact on the ministry’s activities, with respect to project delivery.
Umahi said: “The President inherited a total of 2,604 projects as at 29 May 2023. The total cost was N13 trillion, that was what the President inherited. And a debt to contractors of N1.6 trillion.
“When you look at the variations by reason of the floating of the naira, you will find that if you review all these projects, you get over N19 trillion, the total ongoing projects.
The minister further explained that the President decided to keep all the projects alive, with the hope to get funding from internal and external sources, including loans, because of his concern for the well being of Nigerians.
According to him, the president has given priority attention to the ministry of works, knowing fully that roads and bridges have the potential of unleashing unprecedented economic benefits for citizens.
He also explained that the ministry would not hesitate to revoke the Abuja-Kano road contract awarded to Messers Julius Berger should it fail to mobilize to site at the expiration of the 7-day ultimatum given to it. The ultimatum expires tomorrow
According to him, negotiation between the ministry and the contractor went on for the better part of 17 months and government decided there must be an end to it.
