President Bola Tinubu met with German Federal Chancellor, Olaf Scholz, where he discussed Nigeria’s determination to pursue German investment in the power and rail sector, among others.
The President met with Scholz on the sidelines of the G20 Compact with Africa Economic Conference on Monday.
He noted that his administration is eager to partner with German companies, such as Siemens AG, in reforming the power sector of Nigeria.
Recall that former President Buhari established in 2018 Siemens-backed Presidential Power Initiative (PPI) as an attempt to resolve the lingering challenges in the power sector and to expand the capacity for future power needs.
Siemens Energy was expected to facilitate financing for the project through the German Export Credit Agency (Euler Hermes AG), other ECA’s, and other financing Agencies.
However, President Tinubu noted that there is a need for a review of the initiative to ensure the speedy execution of targeted projects in the power sector.
Noting Siemens AG’s positive impact on the quantity and quality of Egypt’s electric power supply, the President declared that, with his leadership, the implementation of the PPI would now proceed with increased urgency and a more deliberate approach to project execution.
- “For me, I am very much committed to pursuing all aspects of the Siemens Power project and the skill development opportunities that will emerge from that project for our talented youths who can participate in sustaining the industry,” the President told Scholz.
What Germany is saying
On his part, the Federal Chancellor of Germany, Olaf Scholz, signalled a willingness to address administrative and financial challenges in the sector, recognizing the governance issues inherited from the previous administration.
- “I know that there is a lot of work that has been done. There is already a big production of electricity in Nigeria, but it is not getting to the population. Of course, this has to do with the need for a provision of stations and infrastructure on the grid.
- “Siemens has developed the plan and is ready to deepen implementation, but it is now up to your new government to take the follow-up action that you are now committed to taking. On the railway plans, Siemens will be very happy to do this when more progress is made on the power project which has been started already,” he said.
Speaking on the investment in the rail sector, Scholz said Nigeria can replicate the success of China, noting that the country shared similar opportunities and conditions with the Asia country.
- “There is nothing too unique about the growth of China. It came down to a lot of investment from overseas that leveraged cheap and skilled labour with adequate internal infrastructure and shipping infrastructure for imports and exports to flow easily. These things are possible in Nigeria. You even have abundant natural resources. Step by step, it is achievable, Mr. President,” he added.
What you should know
Germany has shown a great willingness to invest in Nigeria with its Chancellor, Olaf Scholz, visiting the country earlier in October.
During his visit, Scholz noted Nigeria’s huge capacity for Liquefied Natural Gas (LNG) production. He also pledged to invest in the county’s mineral resources as well as the rail sector.
Given the Israel-Hamas conflict as well as the crisis fuelled by the Russian war on Ukraine, Western European countries have increasingly begun to turn to Africa for their energy sustenance. Nigeria has one of the highest oil reserves in the world, creating an opportunity for both countries to deepen their investment ties.