AfDB Targets Innovative Financing To Bridge Nigeria’s $2.3trn Infrastructure Gap

AfDB Targets Innovative Financing To Bridge Nigeria’s $2.3trn Infrastructure Gap

The African Development Bank (AfDB) has stated it is applying innovative solutions to help Nigeria raise investments for infrastructure estimated to require $2.3 trillion to reach international benchmark of 7.0 per cent infrastructure to GDP ratio.

This was disclosed on Tuesday in Lagos by the Regional Integration Coordinator, AfDB Nigeria Country Department, Mrs. Omotere Omoluabi-Davies, at the West Africa Infrastructure Expo that was organised by the DMG Events.

Omoluabi-Davies also said the bank is also introducing Naira denominated facilities in order to counter foreign exchange risks due to fluctuations in the value of local currency.

She said: “We do things a little bit differently, especially how we mobiliseand scale investments, how we strengthen project bankability and how we accelerate delivery, which is where we have lesson to learn.

“We are aware of the capital-intensive nature of these projects, so to do that we look for innovative solutions and how to manage risks effectively for the delivery of infrastructure.

“Our goal is not to crowd out private capital. It is to see how we can have compatibility, value addition and attracting private capital through de-risking and value addition for sustainability.”

She explained the two priorities of AfDB’s country strategy in Nigeria are climate smart infrastructure and to ensure job creation.

She added: “AfDB is creating credit enhancement facilities like Infracredit by joining with other partners like the African Finance Corporation, the Development Bank of Nigeria, Nigeria Sovereign Investment Authority, etc.

The Infracredit is to capacitate infrastructure credit by providing guarantee for local currency bonds issued for financing infrastructure in Nigeria.

“As at September 2025, infracedit has delivered 22 infrastructure projects and mobilised about N308 billion of long term funding from 21 pension funds institutions and other institutional investors in Nigeria.

“It is also supporting first time bond issuers especially green infrastructure bond and the longest non-sovereign corporate bond of up to 20 years that is unusual in the market,” she said.

Omoluabi-Davies said that 60 per cent of AfDB’s portfolio in Nigeria is for infrastructure, “but a bulk of that 60 per cent is focused on the infrastructure, energy, industrialisation and the digital landscape.

“Now, on the currency issue, this has been a big issue, especially given all the fluctuations and the currency risks we have seen in Nigeria, and not just Nigeria, but the continent in the last couple of years.

“So, yes, indeed, most of our financing is in foreign currency.

“We have some instruments where we are trying to develop more Naira-denominated loans.

“So, in fact, our portfolio in Nigeria is about $5.2 billion, and I think 60 per cent of it is public and 40%l per cent of it is private, and across all the sectors.”

In her welcome remarks, Senior Vice President, DMG Events, Ms. JosineHeijmans, said that as Africa’s largest economy, Nigeria is at a critical stage in its development journey of advancing its long-term infrastructure ambitions, reliable transport networks, resilient power systems, digital connectivity, water infrastructure and sustainable urban development, a which are increasingly central to economic growth and national progress.

“Wednesday’s summit brings together policymakers, project owners, investors and delivery partners to focus on how these priorities can be translated into tangible outcomes.

“The summit will host strategic dialogues focusing on delivery, investment and innovation.

“Through shared insights and perspectives, the discussions will explore how policy alignment, effective partnerships and investment-ready models can accelerate infrastructure delivery across Nigeria,” she said.

In his opening speech during the expo titled “From Dialogue to Delivery: Bridging Nigeria’s Infrastructure Gap,” the President of Nigeria Society of Engineers (NSE), Mr. Ali A. Rabiu, said that closing Nigeria’s infrastructure gap, estimated at over $2.3 trillion, could unlock a new era of productivity, jobs, and prosperity for over 220 million Nigerians.

Rabiu said the country is facing a paradox of quantity without quality as “we have built roads that decay before completion.

“We have ports that handle 70 per cent of ECOWAS trade yet remain congested and inefficient.

“We have a power sector where available generation struggles at roughly 5,400 megawatts—grossly inadequate for our population.

“And our debt servicing costs have consistently outpaced capital expenditure, choking our ability to build new assets or even maintain existing ones.

“The result? It is often cheaper to ship a container from China to Lagos than to move it from Lagos to Kano.

“That is not just inefficiency. That is a failure of vision and execution.”

He however noted that bridging these gaps, “can drive inclusive growth, attract domestic and foreign investment, create millions of jobs and position Nigeria as the undisputed regional hub for trade, energy, and digital connectivity.”

Rabiu therefore said that “government must provide policy stability and credible guarantees while the private sector must bring capital, efficiency, and innovation and professionals must uphold ethics and quality.”