Nigeria yesterday secured a $1.1billion (about N176 billion) China Export Import Bank facility to finance three priority projects that are key to the economic transformation efforts of the President Goodluck Jonathan administration.
The terms of the facility are concessional, with 20 years term and seven years grace at 2.5 percent interest.
The three projects and the value of facility to them are the Abuja light rail project of the Federal Capital Territory Administration which will get $500 million; the National Security Development System being handled by Galaxy Backbone plc will get $100 million, while $500 million is for the reconstruction of four airport terminals. The airport terminals are Abuja, Port Harcourt, Lagos and Kano.
The three projects are at different stages and when completed, are expected to deepen economic activities and make life easier for Nigerians.
The Abuja light rail project conceived in 2009 and with work at 25 percent completion, is expected to ease movement in the Federal Capital Territory. The first lot that had been procured out of the six lots, will run from the city centre to Kubwa and the Abuja Airport, where large numbers of people are located. For the Maraba axis, two light rails are to run from Abuja to Masaka in Nasarawa state. One is designed to take wagons and locomotives, while the other, which will take a smaller corridor, will take off when power supply improves.
The loan agreement was signed on behalf of Nigeria by the minister of Finanace and Co-ordinating Minister of Economy, Ngozi Okonjo-Iweala and Sun Ping, managing director, for China Exim Bank. The signing yesterday in Beijing, China, was the climax of a process that started late last year, through February this year.
Speaking at the end of the signing ceremony, Okonjo-Iweala described the occasion as memorable, as it is a path to the accomplishment of the transformation agenda of the present administration.
“It is a happy ending, as we have been able to get financing for three key projects. The first is the $500 million facility to complete the Abuja light rail, to ease transportation within the FCT and get people to work early, and another $100 million for an Information Technology project- the National Security Development System, by Galaxy Backbone. The IT project is to assist our youths to get connected to modern technology.
“President Goodluck Jonathan has tried to fulfill the promises to make things easier for the ordinary people of Nigeria, and this is one of them.
“The loan agreement for the contract of new airport terminals in Abuja, Kano, Lagos and Port Harcourt, is also being discussed and will be concluded and signed with the China Exim Bank today (Wednesday). It would be recalled that the contract was approved by the Federal Executive Council at its meeting last week,” she said.
Earlier, Sun Ping, China Exim Bank managing director, said the bank would always identify with Nigeria’s development aspiration and would work to ensure the success.
An elated FCT minister, Mohammed Bala, explained that N22 billion counterpart funding on the Abuja light rail had been paid, and that the work was now between 23 and 25 percent completed. 43 percent of the materials had been produced by the contractors-CCECC whom he described as having large experience in railway construction and development.
“We are so happy for the facility because funding has slowed down the project that was earlier marked for completion this year. The $500 million that we have just signed, has now made the project completion target of 2014 achievable. The total cost is over $800 million”.
Gerald Ilukwe, managing director, Galaxy Backbone believes the funding will assist in opening up the country and give communication access to Nigerians.
“The private sector has tried to open up communication but this intervention by the Federal Government will give wider communication access and ease of connectivity in the country”.
For the aviation sector, Stella Oduah, minister of Aviation, said the new terminals, on completion, would return Nigeria to the position of a hub on the continent, and deepen employment generation in the sector. The ministry is planning five new modern world class international airport terminals in Lagos, Abuja, Port Harcourt, Kano and Enugu, as well as six cargo terminals.
“Aviation is the driver and nucleus of the economy. Reconstructing the airport is a great achievement because it will grow passenger capacity to over 50 million from the 20 million capacity we currently have. It will also increase the number of people employed in the sector to 1.5 million from the current 60,000”.
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