Despite controversy trailing Nigeria’s debt profile, Federal Executive Council FEC on Wednesday, approved a fresh $247.3m loan for execution of various projects across the country.
Minister of Finance, Zainab Ahmed disclosed this after the Federal Executive Council meeting presided over by President Muhammadu Buhari
This is just as FEC also approved negotiation of variation of $3b component of an initial $8.7b rail transportation loan at commercial terms.
Minister of Transportation, Rotimi Amaechi disclosed that federal government had initially approved the loan but the financiers agreed to provide $5.7b , while FEC approved that the balance be negotiated at commercial rate.
But Minister of Finance disclosed that the loans approved consist of $150 million loan facility from African development bank and $50 million loan from African Grow Together Fund to finance the Nigeria electrification project.
The project is a nation wide initiative to be implemented by the rural electrification agency, to align with the strategy of federal government on electrifying rural community.
The project has four components, including a solar hybrid mini-grid for rural economic development, productive appliance equipment for off-grid communities, energising education, as well as institutional capacity building.
The project is expected to impact about 500,000 people with access to electricity for about 105,000 households.
“The maximum power that will be generated will be 76.5 megawatts installed generating capacity part of which is 68,000 megawatts of solar.
“Eight universities will benefit from this scheme and about 20,000 small, micro, medium enterprises across different communities in the nation.
Council also approved the north Core dorsal regional transmission project for the pipeline for the west Africa power pull priority projects.
The intention is for the creation of regional power pull in the region of west Africa.
“The project aims to connect Nigeria, Niger, Benin Republic, Togo, Burkina Faso with a high voltage 330 kilowatts transmission line, to facilitate energy trade amongst participants.”
“The project is in the total sum of $640 million out of which each of the four countries involved has a component.
“Nigeria has the smallest component in this pact which is a total loan of $27.3 million IADE facility, as a concessionary loan.
“This is a loan that the four countries are taking together, the other three countries have concluded theirs, so this is one of the final stages for Nigeria to conclude its process.
He disclosed that FEC also approved $20 million, for the Lagos State Strategic Transport Master Plan, obtained from the French Development Agency.
“The objective of the project is to improve the living conditions of the inhabitants of Lagos urban area and to promote urban development sitting by efficient and effective transport system.
“The project has two major components, first is to rehabilitate urban roads and the creation of minimum of eight equality bus corridors and the creation of two multi-model inter-changes at Marina and Mile 2.
“The second objective is to provide technical support for implementation and management.
When completed, the project is expected to impact 1.8 million inhabitants of Lagos State and accumulative 1.5 million users per day for inter-model inter-changes without about 620,000 boarding at Mile 2 and 480,000 boarding at Marina. Another estimated 630,000 boarding at QBS.
The project is being undertaken by Lagos State agency, LAMATA under its own strategy. So the federal government is borrowing to unlearn to Lagos following the same terms and conditions that we signed. Our assessment is that Lagos state has the capacity to repay the loan.
According to Minister of Transportation, Rotimi Amaechi , “there was an approval for $8.7 billion for Ibadan to Kano to Oshogbo, to Minna to Abuja. Minna to Kaduna, Kaduna to Kano.
“What we sought for was the variation because the financing authority wanted to find just $5.7 billion. We needed approval to negotiate the remender as a commercial loan.
President Buhari also approved the extension of the Ibadan rail project to Oshogbo to Ekiti as part of the construction, at an additional cost of 500 million.
FEC also approved 23 vehicles at the sum of N474.4 million for the purchase of the operational vehicles for the Nigeria Civil Aviation Authority.
Tony Ailemen, Abuja
