Nigeria - Transport and Logistics: Government investments to provide growth opportunities (Strategy, Performance and Risk Analysis)
In a bid to promote the growth of industry and make the country more attractive to foreign investors, the Nigerian Government intends to invest in the development of new infrastructure, while modernizing select structures. Under the ERGP, the government has committed US$7.1bn over 2017-2020 to upgrade the rail network, airports and roads that are not paved. The renewed investment is anticipated to provide conditions for growth in the transport and logistics industry.
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Increase in the number of road passengers drive road transport GVA
Road transport GVA in Nigeria registered a CAGR of 2.1% from US$5,082.0m in 2012 to US$4,576.7m in 2017. However, it is anticipated to post a CAGR of 5.7% from US$5,204.0m in 2018 to US$6,505.8m in 2022. The primary driver for the growth in GVA over the forecast period is the government’s investment in the development of new roads led by an increase in the number of road passengers. The number of road passengers in Nigeria are expected to post a CAGR of 7.4% from 79,320.0 in 2018 to 105,469.0 in 2022.
Increasing freight traffic to drive air transport GVA
Air transport GVA in Nigeria recorded a CAGR of 3.6%, falling from US$437.6m in 2012 to US$364.4m in 2017. However, GVA is anticipated to rise at a CAGR of 3.8%, from US$406.3m in 2018 to US$472.2m in 2022. The main driver will be the expansion of air freight traffic led by an increase in trade between Nigeria and other countries.
Increase in water freight volume to drive water transport GVA
Water transport GVA recorded a CAGR of 2.0%, falling from US$35.4m in 2012 to US$32.0m in 2017. However, GVA is anticipated to post a CAGR of 5.8%, from US$36.5m in 2018 to US$45.7m in 2022 due to an increase in the inland water freight volumes led by various initiatives taken by the Nigerian Government to develop inland waterways.