The Cost of 64 Years of Abandoned Projects in Nigeria

For the past 64 years, Nigeria has been plagued by phantom contracts awarded to non-existent or incapable companies, contributing to the country’s dire infrastructure challenges. This troubling reality was highlighted in a 2023 report, which revealed that the Nigerian government awarded $1 billion worth of contracts to 14 inactive companies for a Niger Delta community project. Astonishingly, some of these projects never even existed, yet funds were allocated.

Corruption and a lack of proper funding are key reasons why many infrastructure projects in Nigeria remain incomplete. The Nigerian Institute of Quantity Surveyors estimated that 56,000 abandoned projects were scattered across the country, with a value of N12 trillion as of 2021. By 2024, the cost has likely ballooned, given that inflation has skyrocketed from 17.01% in 2021 to 32.2% in 2024. With the rising inflation, it’s clear that the cost of these abandoned projects could have doubled, exacerbating Nigeria’s development crisis.

Contract Awards and Governance Failures

One of the biggest challenges facing Nigeria’s development is the arbitrary manner in which government contracts are awarded. Federal, state, and local government officials are often guilty of awarding contracts to their own companies, or those of their friends and family, with little or no accountability. There is frequently a lack of clarity surrounding timelines, budgets, services, and project scope, leaving room for corruption and inefficiency.

The failure of many projects is tied to poor planning and imprecise estimates in an era of price fluctuations. As Abba Tor, President of the Nigerian Institute of Quantity Surveyors, put it, “Most projects have failed in Nigeria due to a lack of precise estimates required before embarking on construction.”

The Empty Promises of Investment

While the issues of ghost contracts are alarming, they are compounded by what can be described as “investment noise.” Former President Muhammadu Buhari, for instance, made 85 international trips during his tenure, promising investments that never materialized. President Bola Tinubu, within just 16 months of assuming office, made 19 international trips, yet no major investment deals followed.

Atiku Abubakar, a former vice president and political opponent of Tinubu, criticized the frequent travels, labeling them as unnecessary. According to Abubakar, Nigeria doesn’t need a “tourist-in-chief,” referring to the president’s frequent foreign tours in search of investments.

This issue of investment noise is reflected in the Rand Merchant Bank’s 2024 report, where Nigeria’s investability score dropped to 0.163, falling behind Egypt and South Africa. Investors now favor nations like Seychelles and Mauritius, where political stability, market accessibility, and governance are significantly better.

The Road to Recovery

While Nigeria continues to struggle with governance issues, economic instability, and investment challenges, there are some bright spots. The Nigerian Investment Promotion Commission (NIPC) has made strides in fostering a more attractive investment climate, and there have been notable reforms. Earlier in 2024, President Tinubu signed three executive orders aimed at improving investment conditions in the petroleum sector, which has historically been Nigeria’s economic backbone.

However, analysts argue that for Nigeria to genuinely attract investment, the country must address its most pressing issues: security, inflation, interest rates, and governance. Effective public governance is critical in promoting social and economic stability—essential factors that investors look for.

Ultimately, while Nigeria has significant potential with a population of over 200 million people and abundant natural resources, the country must overcome its structural challenges. With reforms, better governance, and an emphasis on accountability, Nigeria could finally begin to fulfill its promise as a desirable investment destination.

Social Media Reactions:

1. “How do we expect Nigeria to grow with ghost contracts and empty promises? Enough is enough!” — @Deborah_Truth
2. “Investment noise, that’s exactly what it is. No results, just talk.” — @FemiTheCritic
3. “56,000 abandoned projects! That’s beyond ridiculous.” — @NaijaConcerned
4. “Tinubu’s travels should yield results, not just photo ops.” — @Justice4Naija
5. “We need reforms that actually benefit the people, not just politicians.” — @Chika_TheReal
6. “Abandoned projects are costing us billions, yet no one is held accountable.” — @SholaEngineer
7. “Atiku is right, Nigeria doesn’t need a ‘tourist-in-chief.’ We need results!” — @Bella_Official
8. “It’s so frustrating to see this cycle of corruption and inefficiency.” — @EzeInformed
9. “Our leaders need to prioritize Nigeria’s needs over their own personal gain.” — @AfricaForward
10. “Investors are turning away from Nigeria, and it’s because of poor governance.” — @Ada_Investor.

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