The House of Representatives Committee on Area Councils and Ancillary Matters has voiced concerns about the engineering designs of major road projects launched by the Federal Capital Territory Administration (FCTA).

Led by Hon. Frederick Agbedi, the Committee visited two major road projects located in the Kwali Area Council of the Federal Capital Territory: the 15-kilometer A2-Pai road and the 11-kilometer Yangoji-Sukuku road. These projects are part of the emergency development interventions for Area Councils managed by the Satellite Towns Development Department (STDD).

Questions About Safety and Feasibility

During their visit, the Committee raised questions about the adequacy of the road designs. They expressed concerns over the safety and feasibility of the proposed plans. Engr. Ibrahim Isa Kangiwa, the Resident Engineer of STDD, responded by stating that the designs for the A2-Pai road were developed in collaboration with ZEBERCED Construction Limited, the contractor.

The project is estimated to cost approximately N30 billion and includes the installation of solar-powered street lights. Kangiwa also mentioned that the project would have a one-year maintenance agreement before the Area Councils assume responsibility for the infrastructure. Despite these explanations, the Committee emphasized the need for formal documentation on the project.

Progress Acknowledged, But Issues Remain

After inspecting the roads, Hon. Agbedi addressed the media. He acknowledged the significant progress in development but pointed out areas that needed improvement. He stated that while development was advancing, concerns about cost, designs, and project appropriations were evident. Agbedi noted that these issues could have been better managed. He stressed the importance of having detailed project designs to effectively track construction progress. Without comprehensive designs, it is challenging to properly evaluate contractors’ work.

Next Steps

The Committee plans to engage further with the FCTA Ministry to resolve these concerns. They aim to ensure better execution of the road projects, ultimately delivering quality services to the people of the Federal Capital Territory.

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The Federal Government has issued six sovereign sukuk bonds valued at N1.1 trillion ($657.6 million) to fund 124 road projects covering over 5,820 kilometers across Nigeria’s six geopolitical zones.

This move underscores the government’s commitment to improving infrastructure through innovative financial instruments.

Emomotimi Agama, Director-General of the Securities and Exchange Commission (SEC), made the announcement during the 2nd International Islamic Capital Market (ICM) conference in Pakistan. He highlighted that the sukuk bonds issued since 2017 have been central to the growth of Nigeria’s Islamic Capital Market (ICM), attracting substantial investor interest with subscription rates peaking at 441 percent.

Agama also noted the increasing trend of sub-national and corporate sukuk issuances in Nigeria, citing examples like Osun and Lagos states, Family Homes Ltd, TAJ Bank Plc, and three other sub-national entities. These sukuk have funded key projects in infrastructure, housing, and banking, marking a milestone in Nigeria’s financial sector.

The SEC chief outlined the diverse investment opportunities now available within Nigeria’s ICM, including 14 registered Halal mutual funds with a combined net asset value exceeding ₦105 billion as of November 2024. The NGX Lotus Islamic Index tracks 11 Shariah-compliant equities, and ChapelHill N-REIT stands as Nigeria’s first Islamic Real Estate Investment Trust, signaling the growing potential for Islamic finance in real estate.

Agama attributed the rising demand for Shariah-compliant products to both global trends—such as economic diversification in oil-dependent economies—and local factors like Nigeria’s large Muslim population, government-backed Sukuk initiatives, and increasing investor awareness. Emerging fintech innovations further support market growth, as evidenced by the SEC’s registration of Nigeria’s first Robo advisory firm focused on Shari’ah-compliant investments in 2022.

Reflecting on the success of the Non-Interest Capital Market (NICM), Agama noted that it has been a strategic tool for infrastructure financing, financial inclusion, and sustainability. He shared that the NICM master plan (2015–2025) aims for Sharia-compliant products to account for 25% of total market capitalization by 2025, with Sukuk contributing 15%. A review of the plan in 2021 set a new goal of 50 Sharia-compliant product listings, totaling at least ₦5 trillion ($11 billion) in market capitalization by 2025.

Agama also acknowledged the 70% success rate in implementing the NICM master plan as of 2022, with key achievements including greater public awareness, increased retail participation in Sukuk, and the introduction of the Non-Interest Pension Fund in collaboration with the National Pension Commission (PenCom). He emphasized the importance of addressing challenges like limited public awareness, the lack of tradable instruments, and the need for better regulatory coordination to sustain the sector’s growth.

The SEC chief also stressed the potential of Islamic finance to address key economic challenges in Nigeria, including infrastructure deficits, financial exclusion, and low mortgage penetration. Agama invited both local and foreign investors to seize the lucrative opportunities presented by Nigeria’s evolving ICM market, which aligns with sustainable economic growth and financial inclusion goals across the African continent.

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Reports show that bitumen costs have surged by approximately 150% within the last seven months, straining funding allocations and pushing project timelines further out.

A 20-tonne load of bitumen, priced at N854,375 in August 2023, has now climbed to over N2 million. The increase has compounded contractors’ struggles, already burdened by rising costs of other materials like cement, diesel, granite, and crushed stones.

Sources from Lagos Public Works report that asphalt, which cost N70,000 per tonne in August 2023, reached N155,000 by March 2024, reflecting the sharp inflation trend.

The volatile costs have spurred calls for contract renegotiations as contractors seek to reconcile these significant price variations with clients. Many contractors have left project sites, citing unsustainable expenses, while some are locked in negotiations to adjust contract terms.

Minister of Works David Umahi has addressed the sector’s challenges, stressing that the federal government will not cover cost variations on projects delayed by contractors. He reaffirmed the ministry’s dual-policy approach, allowing both asphalt and concrete for federal road projects under specific conditions, highlighting that technical decisions are to be made by professionals familiar with industry standards.

The president of the Federation of Construction Industry (FOCI), Vincent Barrah, warned that relentless material inflation has jeopardized projects nationwide, risking both project viability and workers’ livelihoods. Diesel, a key fuel for construction equipment, has also surged, further straining contractors’ finances.

Saidu Hassan, national chairman of the Nigerian Institution of Highway and Transportation Engineers, urged the government to stabilize bitumen prices, emphasizing its critical role in infrastructure projects.

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