By Dr Ousman Gajigo
The government recently admitted that its concession agreement with Africa50 ‘only’ excluded competing bridges for a 50m radius. In addition to competing bridges, there is a clause in the agreement which prohibits the government from constructing competing infrastructure, which did not specify a limit. Senior government officials admitted the existence of this clause only after my revelation left them no choice. What is strange and depressing is that the government highlighted the 50km radius exclusion clause as if it has no major consequences for the country. This couldn’t be more wrong. Let us scrutinise the implications of this clause carefully.
A 50km radius from the Senegambia Bridge is equivalent to a 100km diameter centered on the bridge. The edges of this diameter range from east of Kerewan in NBR to just outside of Kudang in CRR. It covers almost 80% of Baddibu and Kiang, 100% of Jarra, 90% of Niamina and 75% of Saloum. Africa50 was extremely calculating when they chose this exclusion range. While the clause only explicitly prohibits the construction of a bridge within the 50km radius, it effectively precludes the construction of another bridge over River Gambia for the foreseeable future when one considers the geographic and infrastructure realities of the country. I will explain why.
Given our current budget situation and magnitude of our public debt, the only feasible area where the government can actually build a bridge is within this very 50km radius (or 100km diameter). Any bridge west of Kerewan would cost billions of dollars to build because the average width of the river is over 5km. In fact, the Banjul – Barra bridge would cost nothing less than US$2 billion. Not only is that amount three times our whole national budget, it is also higher than our entire GDP (the total national income of the country).
Let’s look at the financing challenge facing the government if it attempts to build a bridge west of Kerewan (NBR). When a government decides to construct a major infrastructure, it can finance it in several ways. One way would be for the government to finance it completely through budget allocation or getting a loan. Another possibility is for the government to undertake a public private partnership (PPP) where it jointly finances the construction of the bridge with a private sector entity. The third possibility is for the construction of the bridge to be done exclusively by private investors, whereby these investors would have the responsibility for the design, construction and operation of the infrastructure.
Budget allocation is out of the question in The Gambia given that our total budget would only be a fraction of the cost of such a bridge (west of Kerewan). Borrowing it would be next to impossible given the size of our existing debt, the repayment of which consumes about 30% of annual budget – much larger than the allocation to any ministry or sector. Given that the country is no position to self-finance or borrow, is it actually possible to get financial assistance from development partners such as bilateral or multilateral development partners in building a bridge west of Kerewan? No. Given the size of our economy, the total allocation that The Gambia can realistically get from the likes of the World Bank or the AfDB, any allocation from a multilateral bank – whether as a loan or a grant – would not be enough to even build the Senegambia Bridge. Most people did not realise that the Senegambia Bridge only got built because the allocation from another country was added to that of The Gambia.
In any PPP, the government would be required to contribute a significant share of the cost of construction. That would be extremely challenging for this government because of the afore-mentioned budget limitations and debt problem. But more challenging for this particular government would be to find investors that are willing to put up more than a billion dollars towards such a joint-venture, which they would consider high-risk given the long-term nature of it, as well as all the associated political risk. Beyond the issue of the government’s ability to finance its share of the cost, a PPP project introduces other risks that are difficult to mitigate when an investor goes into long-term business with the likes of an Adama Barrow-led government.
Any group of private investors that would invest in such a massive capital-intensive project would want to recoup their investments within 25 years. A bridge built under such a commercial scheme with a cost of at least US$2 billion and where the investors would need to earn high returns within a 25-year window would require conditions that are incompatible with current realities in The Gambia.
In other words, constructing a bridge west of Kerewan is highly unlikely by this government given our financial realities. However, it is feasible to finance the construction at Kerewan or a few kilometers east of that town. But any construction of a bridge there would necessitate the addition of complementary infrastructure such as a new road. But this would violate the clause of no-competing infrastructure. What’s more, any area significantly east of Kerewan would fall into the 50km radius and therefore the exclusion clause in the Africa50 concession agreement would explicitly rule out the construction of a bridge.
Now, let’s consider a bridge on the eastern edge of the 100km diameter. The average width of River Gambia at Kaur is about 500m, meaning that US$25 million can cover the design and construction of a bridge to span that segment of the river. Unfortunately, this is also an area that would fall within the exclusion zone, which would violate the concession agreement.
As one goes east of Kaur or Kudang, the need or the feasibility of a bridge decreases for a number of reasons. First, most of the islands in River Gambia are located east of this area and some of those islands are nature reserves. Second, the need of a bridge also declines as one approaches the Sankulay Kunda – Janjangbureh Bridge. Furthermore, note that there are already bridges at Basse (URR) and Fatoto (URR). In other words, building a bridge east of Kudang would not violate the Africa50 concession but would also not be a priority area for such an infrastructure given the existing distribution of bridges in the country.
So, the area covered by the 100km diameter (or the 50km radius) that was explicitly excluded by the Africa50 concession agreement is precisely the region of the country where there is not only a need for a bridge but also where it would have been affordable for the country. By carefully inserting the clause, Africa50 secured the profitability of its investment by ensuring that no infrastructure would be constructed in the country that would interfere with their profitability. They are a commercial entity after all and did what they were created to do. One cannot blame them.
However, the government officials such as Mr Seedy Keita who allowed the insertion of that clause and are still defending it have failed the country. Mr Keita and senior government officials of the Adama Barrow regime have abdicated their responsibility by not prioritising the nation’s interest in a major infrastructure negotiation. It is the classic example of the failure of duty to perform. It is a national embarrassment. In a better functioning country, this would have been a crime.
Explicitly exempting the Barra – Banjul bridge idea from the no-bridge restriction is almost like a practical joke played on the country with the help of incompetent officials. Given the explanation above, the negotiators for Africa50 know that a Barra – Banjul bridge idea is not feasible for the next 15 years or so given our current economic reality. In other words, the exclusion of the Barra – Banjul bridge is completely inconsequential to the profitability of Africa50’s investments because it is just an idea and will remain so for the foreseeable future.
It is important to stress why the Banjul – Banjul bridge is merely an idea on paper rather than an investment plan. Before an infrastructure idea reaches a level where investors can be approached, it must go through several stages. To be investment-ready, a project needs to have feasibility studies, traffic studies, environmental studies and procurement documents, among others. None of these have been done. There also has to be substantive interaction with some market participants to understand the legal, regulatory and other risk factors that would need to be taken into account before a realistic structure starts to take shape. These project development elements are needed before a country can claim to have investment-ready project. Despite the out-of-touch claims by Minister Ebrima Sillah and other government officials, our government is quite far from reaching that stage with the Barra – Banjul Bridge proposal.
It is without doubt that the 100km diameter is adversely consequential to The Gambia’s future infrastructural development. It is an aggravating factor in a deal that was already badly negotiated and is being poorly executed. It represents prioritisation of short-term political ends over long-term development. An example of how badly this was negotiated was the fact that The Gambia did not seek professional and expert assistance during negotiation, while Africa50 came to negotiating table extremely prepared. Africa50 simply pulled the wool over the eyes of Seedy Keita, who will go down in history as one of our most incompetent ministers of finance.
