Nnaji defends privatisation of firms in power sector
THURSDAY, 02 AUGUST 2012 00:00 FROM MADU ONUORAH, ABUJA
THE Federal Executive Council (FEC) yesterday focused on briefings on the economy with the Coordinating Minister of the Economy and Minister of Finance, Dr Okonjo-Iweala, saying President Goodluck Jonathan’s economic reforms had received endorsement at a London Investment Conference which ended yesterday as foreign investors were scrambling to be part of the Nigerian economy.
At the Council session, chaired by Vice President Namadi Sambo, the “tremendous” positive response by international investors was indicative of the global confidence in the macro-economic policies of the Federal Government.
Minister of Power, Prof Barth Nnaji also explained that the privatisation of companies in the power sector is not just about giving it to the private sector to manage but a way of ensuring that the generating companies have the ability to serve powers to the distribution companies that are credit worthy.
Nnaji stated that unless the distribution companies were credit worthy, they would not be able to buy power from the generating companies that would defeat the goal of the transformation in the sector. He expressed regrets that none of the distribution companies were currently credit worthy.
At the close of bidding for power generation and distribution companies on Tuesday, which 79 firms showed interest, Nnaji said 25 of the bids were for generation and management of existing power plants while 54 were for power distribution and transmission.
Minister of Information, Mr. Labaran Maku, who declined to speak on the ongoing controversy between the executive and the National Assembly over the implementation of the 2012 budget, however, explained that the budgeting process was in itself problematic as the implementation of the budget actually started three months ago after it became a law in March.
Maku however assured that once procurement processes were concluded, many more projects would be awarded and result of execution of projects would be more visible.
The minister, who dwelt more on the briefing on the economy, told journalists at the end of the Council session, along with Nnaji, that “Council today took reports of some aspects of the progress being made in the economy. We decided to take a look and hear from ministers some departmental progress and to deliberate and see whether our country is going in the right direction or not.
“We got a major report, preliminary report from the investment conference that was held in London from Monday till today. The Coordinating Minister of the Economy, Dr. Ngozi Okonjo-Iweala reported to council that the about to be completed special investment conference on Nigeria which was put together by the Bank of Industry, in partnership with other institutions, has turned out to be one of those very surprising and indeed very positive reports of how the world is looking at Nigeria currently.
“According to the CME, and her report was also collaborated by several ministers who were also in London, the Conference brought together a number of leading international investors who were looking for the opportunity to invest in Africa. And from the comment and report of what took place in London, the CME told us that the world is very appreciative of the present reforms that have been taking place in Nigeria.”
Maku continued: “Specifically, she said global investors believe that the micro economic policies of Nigeria are currently some of the best in world. They believed that Nigeria’s economy is being run in a very convincing way and that because of the management of the economy and because of the reforms this administration is implementing, most investors believe that Nigeria is a destination for any significant investment in sub-Sahara Africa in decades to come.
“CME said the various MDAs that are lead sectors in economic reforms made presentations in England. The Ministry of Agriculture, Communication Technology, Works, and several other MDAs that deal with infrastructure made presentations to explain the opportunities that exist in our economy and also to explain the various reform policies that the government has been implementing over the years and that the feedback they have given council today is that the interests those investors have shown in the economy of Nigeria surpass the expectation of our own participants.
“The believe that if these reforms go on and given the kind of interest that they showed in London, people seeking to come here, people already investing in these sectors, it is very clear that Nigerian economy is heading in the right direction and that our macro economic policies are applauded,” Maku said.