The comparison between the Lagos-Ibadan Express Road and the Lagos-Badagry Express Road involves two projects of similar size and complexity. Both roads had fallen into substantial disrepair, limiting economic usage and transit and risking the safety of drivers and vehicles using the roadways.

The two projects allow us to look at the attempts of two different contracting regimes: the first to make a public–private partnership (PPP) work, and the second the usual public project construction from the outset. The PPP scheme failed, and yet the Lagos-Ibadan Express Road is complete (or almost complete), whereas there is still no end in sight for the Lagos-Badagry Express Road. Examining the reasons for the problems is instructive for our enquiry.

9.1 The Lagos-Ibadan Express Road Rehabilitation: A Completed Project

9.1.1 Original Construction of the Express Road

The Lagos-Ibadan Express Road is a 127.6 km-long expressway connecting Ibadan, the capital of Oyo State, and Lagos, Nigeria’s largest city. President Olusegun Obasanjo’s Administration constructed the express road in 1978 when he was the military head of state of the Federal Republic of Nigeria. It was Nigeria’s first multi-lane express route.

The road maintenance was handed over to the Federal Roads Maintenance Agency of Nigeria, (FERMA), which had just been established and was responsible for connecting roads between states in Nigeria; it also had the role of improvement, maintenance and construction of new road networks. Road maintenance in Nigeria is subject to annual budgetary appropriation by the federal government and the vagaries thereof.

The road was officially opened to traffic on 8 August 1978. In September serious pavement failure occurred in the form of cracks, potholes, deformations, pushings and ruttings. As a result, an investigation was carried out to determine the causes of failure, the adequacy of pavement design and the quality of the materials used, both in the failed and functioning sections of the road. The results showed the causes of failure to be heavy axle loads, a lack of sub-soil drainage and the use of sub-standard materials (Ibrahim , 1981). Thus, the effects of gouging and corruption were felt almost from day one of the economic usage of this very important economic artery.

9.1.2 A Reconstruction Project in a PPP Scheme

Thirty years later, repairs and improvements to the road, as well as the provision of additional lanes, were long overdue (Fig. 9.1). In 2009 President Umaru Musa Yar’Adua developed a government policy for PPP schemes to help engage the private sector in funding road constructions. The Yar’Adua Administration signed a PPP agreement with construction company Bi-Courtney Highway Services, based on construction costs of $593M, to be executed over four years, with a concession period of 25 years. (There was also a bus rapid transit [BRT] scheme, with a separate lane in each direction alongside the expressway, which was to be delivered by Lagos State Government. This side project created its own problems, but for reasons of space we will not elaborate on this separate project here.)

Fig. 9.1
figure 1

Lagos-Ibadan Express Road before the habilitation contract

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However, the construction failed to take off. Under the contract, the government expectation was that at least the sum of N86.5B ($227M in the 2020 exchange rate) would be spent by Bi-Courtney, but by 2012 not much had happened. While the PPP arrangement remained unexecuted, the expressway was a source of grave hardship to travellers, with a resultant loss of productivity from long travel times, in addition to a loss of lives and property through vehicle accidents and robbery, among other things (Elebiju & Ilesanmi, 2020). Bi-Courtney said the delay in executing the concession came from a government delay in the approval process of the project design.

In 2012 President Jonathan cancelled the concessionary agreement with Bi-Courtney. In November Mike Onolememen, Nigerian Minister of Works, announced revocation of the agreement. A government investigation judged the concession of the Lagos-Ibadan Express Road a failure: several things had been taken for granted by both government and the concessionaire. The government officials did not have enough knowledge about PPP schemes and they failed to employ the services of experienced legal/transaction consultants or technical advisers. Thus, the design of the project was left entirely to the concessionaire, who drew up an agreement that was skewed in its favour—the result was structured to fail from the outset (Ahmed , 2011).

However, a Bi-Courtney company representative emphasized in an interview with us that the delays had been caused by the behaviour of the government: first, the Ministry of Works delayed the approval of the road project from the agreed 6 months to 18 months, accounting for a whole year of delay. Second, the investor (who would take the PPP concession) wanted certain guarantees, such as being paid back in dollars, not naira, and getting some assurances about minimum levels of toll income. The government, however, refused to give commitments, while demanding a design change with more lanes, which the investors resisted because traffic predictions did not justify the extra lanes. The apparent “non-work” was a result of these frustrating deadlocks. In the end a final decision meeting between Bi-Courtney and the Ministry of Works was repeatedly delayed because one ministry official after another refused to chair the meeting; eventually, President Jonathan decided the delay was unacceptable and simply revoked the concession.

Bi-Courtney challenged the decision in court and managed to secure a court injunction restraining a new concession agreement, which was finally rejected in court only in 2016 (The Nation , 2016). The subsequent administration under President Buhari also criticized Jonathan’s government for cancellation of the contract. The Minister of Works, Housing and Power, Fashola, said during an interview: “The past government did not act in good faith (…). The answer is no cancellation if the contract is performing. What to do is renegotiation. I am not saying that the government must not terminate non-performing contracts. Indeed, these are rights that are standardly provided in all well-drawn contracts” (Jimoh , 2021: 118). In other words, the subsequent government alluded that a negotiation should have been attempted with Bi-Courtney in order to avoid failure of the PPP scheme. (However, this criticism needs to be interpreted in light of the hostility against PPP schemes, which the Buhari government itself exhibited in the context of the Second Niger Bridge project.)

9.1.3 Restructuring the Project as a Government-Owned Project

The President Jonathan Administration, after revocation of the concessionary agreement, awarded the contract for rehabilitation of the road to Julius Berger Nigeria and Reynolds Construction Company Limited, for the sum of N167B (then $801M, and in 2020’s exchange rate $440M). On 8 July Mike Onolememen, Minister of Works, announced that the two firms had emerged as the preferred bidders and would deliver the road within 48 months (by 2017); also that the ministry had obtained the certificate of “No Objection” from the Bureau of Public Procurement (BPP) (The Nation , 2013).

However, the running of the road reconstruction as a public project brought back the all-too-familiar problem of unreliable funding. Funding was intermittent, and the contractors were not paid. Construction slowed and then stopped when 2016 brought a walkout.

In June the Minister of Power, Works and Housing, Babatunde Fashola, presented to the House of Representatives’ Investigative Committee on Breach of Privilege, Violation of Appropriation Act and Incitement of the Nigerian Public a request for a supplementary budget or a transfer of funds with legislative approval. In the same presentation he accused the National Assembly of slashing N21B off the N31B vote for the Lagos-Ibadan Express Road. He said: “We were asked to complete those abandoned projects; the budget of the Lagos-Ibadan Express Road was reduced by the National Assembly from N31B to N10B. We owe the contractors about N15B, and they have written to us that they are going to shut down.”

The walkout letter by the division manager of Julius Berger, received on 5 June, said: “Honourable Minister, it has become evident that the required adequate funding for the continuation of the project is not available (…) We trust you will understand that therefore, and as a consequence of the unacceptable financial risk to Julius Berger Nig. PLC, we are left with no choice [other] than to immediately commence suspension of the works on the project, as earlier notified.”

The corresponding letter from Reynolds Construction, dated 2 June, said: “At the moment, the outstanding debts for approved certificates for certified works stands at N7, 829, 277, 294 (…) It is noted that the 28-day window allowed for payment of the certificates by Clause 60.4 of the Conditions of Contracts had long expired. In addition, there is another certificate (No. 19) of N1,108,334,258 under processing. (…) Thus, making a total of N8, 937,611, 552. The mounting debt profile on this project is worrisome” (Olawoyin , 2017).

The news in 2018 was that the current government had “cleared the debts” for the project (i.e. they had paid the contractors), and around 50% of the highway upgrade had been carried out at this point (Fig. 9.2). However, as a result of these funding-related hold-ups, project completion would not be achieved until 2021 (World Highways, 2018). The latest update comes from an announcement by the Minister of Works and Housing on television in Abuja on 5 June 2020, “committing” the federal government to completing the Lagos-Ibadan Express Road in the first quarter of 2022.

Fig. 9.2
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Lagos-Ibadan Express Road during the habilitation contract

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9.1.4 Discussion

We have listed the Lagos-Ibadan Express Road as “completed” because, with the current funding and the two contractors reaching the home stretch, there is a reasonable expectation that it will be finished by 2022 (or maybe soon after). However, this project is no great success. It will limp to completion at best after 13 years (more than three times the originally planned 4 years), with a budget of perhaps $1.2B (four times the original budget of $300M).

We have seen similar problem themes in several other cases, in particular, the instability of funding, to the point of contractors stalling, and the disruption from one administration to the next. One particular theme of this case is the failed PPP scheme. We have seen an announced (but probably not entirely real) PPP scheme, which was nevertheless strongly condemned by the Buhari government, in the Second Niger Bridge Project. We will also see a failed PPP scheme in the Ajaokuta Steel Project. The PPP failure in the Ibadan project is particularly instructive.

The claims and counterclaims are complicated and messy—Bi-Courtney was accused of having negotiated a lopsided agreement in its favour (taking advantage of inexperienced government counterparts) and of a conflict of interest involving having the honorary legal adviser to President Yar’Adua on its board. On the other hand, Bi-Courtney argued that the road had not been developed because its efforts to source funds to execute the project had been frustrated by the federal government, in addition to being held back by bureaucratic bottlenecks at the Ministry of Works.

The real lesson here is that the failure of this PPP was not caused by specific idiosyncratic reasons but reflected a general problem of one administration’s agreements not being honoured by the next. One legal analysis comments: “Notoriously, when there is a change of government in Nigeria, contract agreements of the previous administration may be subject to ‘review’ or ‘probes’, which are sometimes politically motivated and not driven by public consideration. In this instance, President Yar’Adua’s Administration’s concession was cancelled by President Jonathan’s Administration” (Elebiju & Ilesanmi, 2020), which was, in turn, criticized by the next administration, as we saw earlier.

Moreover, this observation from within the country is corroborated by an analysis from the UK: “According to stakeholders consulted, there is still some uncertainty about the extent to which government is committed to the concept of road user charges. The government is reportedly currently working to develop a National Tolling Policy and has draft legislation under consideration by the National Assembly, which is meant to formalize the government’s commitment to increasing the level of private finance in the road sub-sector. However, both bills have been in development for a number of years – the concept of establishing a road fund and a federal road authority were initially developed in 1997 by the Steering Committee for Road Vision 2000” (Cambridge Economic Policy Associates, 2015: 10).

As we will discuss in our Conclusions and Recommendations chapter, PPP schemes can be powerful ways to get infrastructure projects completed without stretching public finances. However, this requires a clear and reliable government policy, together with the sophisticated capability of the government to negotiate productive agreements with hard-nosed concessionaires. If these conditions are not developed in Nigeria, this avenue for the productive mobilization of private capital will not be available.

9.2 Lagos-Badagry Express Road Rehabilitation: A Stalled Project

9.2.1 Brief History

The Lagos-Badagry Express Road is the local name for the Nigerian section of the Trans-West African Coastal Highway. The road connects Lagos, Nigeria, with Dakar, Senegal, and the Nigerian part ends at Seme Border Station. Construction on the Lagos portion originally commenced in 1998. As an extremely important artery for intra- and inter-country transit, it was decided in 2010 to make a concerted effort to widen the road from two lanes (with four lanes in some sections) to ten lanes, with a light rail running in the centre. President Jonathan awarded the $500M contract to the China Civil Engineering and Construction Company (CCECC), a state-owned enterprise (SOE) from China.

The project was greeted with jubilation by all stakeholders, given the immense need for transportation capacity. However, by the end of 2020 it had still barely begun (the Federal Controller of Works called the work “10.6% completed” in December 2020 [NAN , 2020]). Moreover, instead of improving the lives of the residents in the adjacent areas, it has made their lives worse, having brought traffic to a virtual standstill, resulting in significantly increased commuting times (from 15–20 minutes to 3–4 hours in some stretches), slowing down business transactions (forcing companies to open local offices because their employees cannot travel), causing accidents and resulting in robberies of commuters, who are sitting ducks in their cars.

The project demonstrates a combination of insufficient financial planning, which resulted in unreliable funding, questionable accounting and misrepresentations to the public, with excuses that point away from the sources of the problems.

Maybe the project has not strictly been abandoned (a transportation artery of this importance cannot simply be “abandoned”). However, despite repeated assurances from various parties, after 10 years there is no end in sight for a 60 km stretch of motorway (Fig. 9.3). Completion of the project will certainly not happen within the period of the current Federal Buhari Administration, and it is not even remotely within sight (Ochonma , 2019).

Fig. 9.3
figure 3

The state of much of the Lagos-Badagry Express Road ten years into the project

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9.2.2 Was the Problem the Fault of the Contractor?

The contract was awarded to Chinese SOE CCECC. The contractor left the site in 2016, and the Lagos State governor vowed to “order them back onto the site” in 2019. Was this contractor a failure?

Chinese contractors have been influential in Nigeria for three decades, and CCECC is the most prominent among them. Chinese contractors have gained significant market share in Nigeria because they “undercut local contractors by 25%” (Corkin & Burke, 2007); in addition, they bring financing from China that has, in contrast to loans from the IMF or Western countries, no strings attached in terms of political practices of the government (Osondu-Oti , 2016). On the other hand, Chinese contractors are not well liked by their local competitors (not surprisingly) or by employee associations because they skimp on wages and have the reputation of monopolizing senior management positions for Chinese employees, leaving only low-level positions to Nigerians.

In addition, there is growing suspicion about China, and by association against CCECC as a fully government-owned SOE, with respect to their motives. Are they spying and secretly identifying natural resources to be exploited? For example, some journalists have asked: “Such use of the area photographs that identified the locations of minerals through the use of sophisticated seismic instruments was evident in the recently arrested Chinese nationals in some Northern states where they were extracting minerals for exportation to China. Is such an act classified under ‘Railway’ construction?” (Odunmbaku-Wilson, 2020).

However, CCECC is clearly a competent and established contractor. It holds more than a hundred public contracts in Nigeria, including the $1.2B light rail project in Lagos, the Lagos-Kano railway, with a budget of $1.4B and four airport terminals to the value of $500M. CCECC did abandon a contract previously—in 1995 (military) President General Abacha awarded them a contract to rehabilitate the national railway system (with straightening of tracks, adding locomotives and training local personnel). However, a senior foreign affairs officer in the Ministry of Foreign Affairs later admitted that the project had not been completed because of inadequate funding/non-disbursement of funds (the complication being that there might be undisclosed reasons for abandonment that were not available to the ministry, as the military exclusively handled external relations) (Osondu-Oti , 2016: 35).

The conclusion of this discussion is that the contractor was most likely not the cause of the problems; rather, their walking off the construction site in 2016 was a symptom of the continuing instability of funding, resulting in a failure to pay their fees.

9.2.3 Dodgy Funding and Accounting

In 2009 the federal government received a $660M loan from the World Bank. However, only a small portion of this fund was for the Lagos-Badagry Express Road (addressing only an important intersection within Lagos), and this part of the loan was finally approved by the federal government only in 2016 (Opeyemi , 2016). The funding ran out quickly and with it the payments to the contractor CCECC, who ultimately abandoned the site in 2016 to stem their losses. However, the funding scarcity could not be discussed by the contractor in public: a CCECC representative still gave the rainy season as the official reason for the lack of progress (Premium Times , 2017)—rains are indeed torrential during rainy season, but this is hardly an excuse in a region of Nigeria where this is the case every year.

However, various government sources did admit the funding scarcity. For instance, the commissioner for works and infrastructure admitted in April 2016 that the slow pace of work on the Lagos-Badagry Express Road was due to the scarcity of funds for the project, elaborating that the ministry had inherited 244 road projects from the previous administration in different local government areas of the state and 42 of the projects had been completed, while construction work was ongoing on others (Ihua-Maduenyi , 2016). Furthermore, in November 2020, Babajide Sanwo-Olu, Governor of Lagos, finally alluded to overambition, publicly stating that the delay had been caused by “the government’s plan to build a first-class infrastructure that people would be proud of when completed [turning it from a two-lane road into a highway of ten lanes with a light railway in the centre]” (Olisah , 2020) (Fig. 9.4).

Fig. 9.4
figure 4

Large portions of the Express Road are still under construction in 2021

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Disturbingly, possible severe budget irregularities came to the attention of the public in connection to the Lagos Light Rail Project (which was the “Siamese twin” of the express road project because the rail in its centre is part of the light rail project). However, an unwillingness by federal and state agencies to work together was one obstacle for the Siamese twin. The light rail project had been commenced in 1983 (as the “Metroline Project”) by Governor Jakande but was stopped by (military) President Buhari two years later on the basis of it being a waste of taxpayers’ money. The project was revived by Governor Tinubu in 2003, with a budget of $1.4B. However, little progress had been made when Tinubu left office in 2007.

The new governor, Fashola, revived the project again in 2008, awarding the contract to CCECC and promising completion in 2011. When this deadline passed, a new deadline of 2015 was set, which also passed. At this point, the governor’s spokesperson commented: “Let me draw your attention to the fact that when the governor said that (rail will be completed in June 2013), he also mentioned that all these will be subject to availability of funds. So, if the World Bank loan is still being held up by the federal government and there are still issues, definitely it would be impossible to do magic” (Olawoyin , 2020). The next governor again promised completion of the light rail project, the deadline for which again passed in 2019. The current governor, at the time of writing, Sanwo-Olu, promised that the blue line rail project would be completed in 2020 and become operational in 2021, but there are no indications that this will happen.

Confidence does not seem to be increased by accounting discrepancies in Lagos. In a 2010 report delivered by the China Railway Construction Corporation to its shareholders, published on the company’s website, the company claimed that the sum of $182M had been earmarked for completion of the project. This differed from the one released by Lagos State Government, which puts the project cost at $1.2B (Olawoyin 2020). Moreover, some basic benchmarking was offered by the opposition politician, Gbadamosi, who said in a public debate before the election in 2019: “The light rail project is being built at a cost of over $1B. However, there is a heavy rail project in Addis Abbaba that started in 2011 and was completed in 2016, already in use. [It was] Built at the cost of $5.2M per km, where we in Lagos apparently spend $54M per km on that light rail project, which has been on for the past ten years and has not been completed” (Gbadamosi, 2019). Of course, these are the words of an opposition politician, but they pose difficult questions about cost levels and squandered budgets nonetheless.

9.2.4 Protest, Additional Funding and Patching Up

On 20 May 2019, road users, including business people and private citizens, as well as students of Lagos State universities, staged a significant protest. Dr Joe Okei-Odumakin, one of its leaders, said to the authors that the protest denounced the poor condition of the road and the challenges of hardship, economic loss, delayed medical emergency help, as well as street robbery (because car drivers stuck in traffic are easy victims). They accused the government of a complete lack of concern about their needs. The federal and state governments mobilized massive security forces to dispel the protest with guns.

At this point, finally, additional funding was mobilized. In 2020 the Federal Government of Nigeria raised N100B (approximately $330M) with an Islamic Finance fund via income-bearing Sovereign Sukuk certificates, with the purpose of financing real estate and manufacturing investments. Correspondingly, the government’s 2020 budget contained N2.73B (around $7M) for the Lagos-Badagry Express Road (Okeowo , 2020), but there would be additional funding of N4.5B (approximately $11M) from the Sukuk fund (NAN , 2020).

In June 2020 Lagos State Government summoned the contactor, CCECC, to return to the construction site. However, in the meantime, “palliative” work was assigned in two sections to state agencies of Lagos State Government and the Federal Government of Nigeria (Construction Review Online , 2019). This was hailed in a ceremony by the deputy governor, who lauded the cooperation across agencies (indeed, a federal and a state agency working together without mutual sabotage was hailed as a major success).

However, the measures are only “palliative” (reflecting the funds available)—they patch up portions of the road in order to allow cars to move, but they do not address the widening of the road through additional lanes and the addition of the light rail. Although this is celebrated as a success for local citizens (and it does improve their commutes somewhat), it does not address the fundamental lack of progress of the project. The 10.6% completion status cited by the federal controller of works looks like it will stay that way for the foreseeable future.

9.2.5 Conclusion

The Lagos-Badagry Express Road is a crucial project with huge economic benefits and support from stakeholders on all sides. No technological uncertainties have hindered progress. However, it has not made significant progress over ten years, in the process worsening the lives of the citizens living nearby (Agency Report, 2021).

The themes that appear as explanations are recurring: overambition (possibly driven by pride or special interests) made the required budgets very substantial, which, combined with a lack of financial planning, led to an instability of the budgets available. This, in turn, made progress a hostage to money shortages, prompting the contractor to stop work. Added to these economic obstacles were dodgy accounting, which, as with the sister light rail project, may have funnelled a significant part of the already scarce funds into corrupt avenues, and all this was exacerbated by multiple subsequent politicians using the project (as well as other projects, such as the Lagos Light Rail Project) as campaign fodder, promising delivery to tight deadlines without a plan (or commitment) for how to make it work. In short, the project was set up to fail, just like other projects in our sample.