Uwaleke Lists Options for Infrastructure Financing Beyond Govt Borrowing

Renowned financial expert, Prof. Uche Uwaleke, has urged Nigeria to reconsider the way it finances infrastructure development due to the growing public debt burden. In an article, he outlined various financing options available in the Nigerian capital market, such as infrastructure bonds, infrastructure funds, and investment trusts, which can attract institutional investors and ordinary Nigerians into commercially viable projects.

The Debt Management Office (DMO) statistics show that Nigeria's total public debt reached N166.79 trillion by June 30, 2026, up by N14.39 trillion (9.4%) from N152.40 trillion in the previous year. The debt stock increased by N7.44 trillion within three months alone. With the projected debt service cost of US$11.6 billion in 2026, Uwaleke emphasized the need to move away from a model where the government finances most of the infrastructure projects, bearing most of the financial risks.

Instead, he proposed leveraging the Nigerian capital market to attract private investment and reduce the burden on government finances. Properly structured instruments like infrastructure bonds, funds, and investment trusts can channel private savings into productive projects while ensuring long-term financing is supported by the revenue streams generated by the assets themselves.

Infrastructure bonds, for example, can provide long-term financing whose repayment is secured by the cash flows of the infrastructure project, making them potentially self-liquidating. Infrastructure funds and investment trusts can diversify risk across a portfolio of projects and enable investors to acquire an economic interest in infrastructure assets, sharing in the income they generate.