$155m World Bank Loan: Nigerian Senate, activist call for suspension of national metering programme
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Oredola Adeola
The Nigerian Senate and Adetayo Adegbemle, a convener of PowerUpNigeria have, in a separate announcement, called for the immediate suspension of the US$155 million World Bank-funded, National Mass Metering Programme (NMMP) Phase 2, thereby demanding protections for domestic manufacturers of meters and compliance with local content regulations.
The Senate during the plenary on Thursday while seeking to undertake a comprehensive review of the procurement criteria to prioritize local manufacturing and assembling, urged the Transmission Company of Nigeria (TCN) and the Nigerian Electricity Regulatory Commission (NERC) to seek alternative funding from the Central Bank of Nigeria (CBN) intervention funds or the African Export-Import Bank (AFREXIM) to fund the programme.
The Senate is acting on a motion sponsored by Senator Victor Umeh, Anambra Central, on the urgent need to protect local meter manufacturers in the federal government’s ongoing national mass metering programme.
The Senate said the review of the NMMP would ensure that provisions of the local content and backward integration policy are complied with, which aim to promote local capacity building, employment generation, and economic growth for Nigeria.
The Senate has charged the executive to immediately suspend the TCN Tender for World Bank-funded NMMP Phase 2 in order to undertake a comprehensive review of the procurement criteria to prioritize local manufacturing and assembling in line with local content and backward integration policy that catalyzes local capacity building, employment generation, and economic growth for Nigeria.
The Senate has also urged the Transmission Company of Nigeria and other stakeholders to negotiate and engage the African Export-Import Bank (AFREXIM) and the African Development Bank (AfDB) for alternative loans if World Bank loan conditions do not favor local economic growth at this critical time of massive unemployment and devaluation of Naira.
Senator Umeh in his argument expressed concern that the ongoing World Bank-funded National Mass Metering Programme (NMMP) Phase 2 in Nigeria seeks to promote foreign companies’ participation against competent and prequalified local meter manufacturers, which will ultimately result in the loss of jobs and revenue.
He argued that the bidding criteria put in place, which can only be satisfied by foreign companies, have totally marginalized and eliminated the participation of the 35 local meter manufacturers.
He also noted that the current bidding criteria not only negate some policy initiatives that will facilitate the establishment of a local metering industrial base with its impact in terms of generating employment opportunities for Nigerians, but it also enables the loss of revenue to the nation by granting these foreign companies an additional concession of a custom duty waiver of 45%.
Senator Umeh further argued that if the bidding process continues as it is, the outcome would be disastrous to members of the Association of Meter Manufacturers of Nigeria who have invested billions of Naira in the sector and currently employ 10,000 workers directly and more than 30,000 workers indirectly.
He expressed concern that if the Federal Government and other stakeholders do not make an urgent intervention, the ongoing World Bank-funded NMMP Phase 2 would ultimately encourage foreign company participation and loss of jobs and funds, to the detriment of local manufacturers.
The Senate has also resolved that local manufacturers should be given intervention through the Central Bank of Nigeria (CBN) intervention fund.
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Adetayo Adegbemle, a convener of PowerUpNigeria, an electricity advocacy group, in a statement obtained by EnergyDay also opposed the Federal Government’s plan to use to import fully built meters into the country.
Adegbemle argues that this plan is against the local content of the federal government policies, which would kill the Local Metering Industrial base in the country.
He noted that the procurement plan of the country is governed by the World Bank procurement policy, which guides and defines what can be done and what cannot be done.
Adegbemle urges the federal government to review the subsidy policy from consumption-oriented to production-based and stop taking loans to fund consumption.
He argues that the high financial and technical qualification criteria for the metering project contradict what was captured in the World Bank procurement guidelines 2020.
Adegbemle suggests that the PMU could have ensured the full participation of local and international actors from the beginning in a manner that takes into consideration the key policies of the federal government.
