Former Director General of the Nigeria Governors’ Forum (NGF), Earl Osaro Onaiwu, has urged state governors to capitalize on the current economic climate to raise long-term capital for transformational infrastructure projects. Onaiwu made the call in a statement issued on Wednesday in Abuja. He emphasized that with the removal of fuel subsidy and increased Federation Account allocations, states now have greater room to think bigger about development. This presents an opportunity for governors to make bold infrastructure and industrial decisions.
According to Onaiwu, the removal of the petrol subsidy represents a major shift in the financial relationship between the Federal Government and the states. Resources previously absorbed by the subsidy regime are no longer creating pressure on public finances. Increased revenues flowing through the Federation Account have strengthened the financial position of state governments. At the same time, debt pressures have moderated, giving states with sustainable finances greater capacity to consider long-term funding for development.
Onaiwu noted that governors should strategically use the opportunity to convert stronger state finances into productive assets required to build competitive state economies. The central question for governors should be how to unlock investment, create industries, and generate thousands of jobs. He emphasized that rather than allowing increased revenues to disappear into recurrent expenditure, states can leverage their stronger financial position to access larger pools of institutional capital.
The former NGF DG urged governors to look beyond conventional budget financing for major infrastructure projects. He opined that attempting to finance such projects entirely through annual budgets can delay completion, increase costs, and limit the scale of what governments can undertake. Onaiwu suggested that the capital market provides another route for states to mobilize substantial capital for projects in power, transportation, industrial development, housing, healthcare, agriculture, logistics, and water infrastructure.
Onaiwu explained that through appropriately structured bonds, Sukuk, and other long-term instruments, qualifying states can mobilize capital for development. He emphasized that states should not be afraid of capital market financing simply because it involves borrowing. The real consideration should be what the capital creates. Debt used to finance consumption leaves an obligation, whereas capital deployed into productive infrastructure can leave behind economic assets that continue generating value.
The former NGF helmsman noted that governors should increasingly think about the potential of capital market financing. He emphasized that major infrastructure projects often require substantial upfront capital and long development periods. Onaiwu urged governors to make bold decisions that can unlock investment and create industries. This can be achieved by leveraging the capital market to access long-term funding for development.
Onaiwu’s call to action comes at a time when state governments are seeking to accelerate development and create jobs. By investing in capital markets, governors can unlock new opportunities for growth and development. Ultimately, this can lead to the creation of thousands of jobs and a boost to state economies.
Key points
- Former NGF DG Earl Osaro Onaiwu urges state governors to leverage capital markets for infrastructure projects.
- The removal of fuel subsidy and increased Federation Account allocations present an opportunity for governors to make bold infrastructure and industrial decisions.
- Onaiwu emphasizes that capital deployed into productive infrastructure can leave behind economic assets that continue generating value.
