Nigeria Approves $9 Billion Foreign Infrastructure Loan

Nigeria’s National Economic Council approved a $9 billion loan from lenders including the Export-Import Bank of China, the Islamic Development Bank and the African Development Bank.

The loan, part of the country’s 2012-2014 borrowing plan, will be used by federal and state governments to fund new infrastructure, invest in agriculture and create jobs, National Planning Minister Shamsudeen Usman told reporters yesterday in Abuja, the capital. Interest rates on the loan will be as low as 2 percent, and the repayment period is 40 years, with a 10-year moratorium.

Nigeria, Africa’s largest oil producer, relies on crude exports for about 95 percent of its foreign-currency earnings and 80 percent of government revenue, according to the Finance Ministry. The West African country, sub-Saharan Africa’s most populous, with more than 160 million people, is increasing infrastructure spending to spur business and boost economic growth.

The council, headed by Nigerian President Goodluck Jonathan, also approved a $3.37 billion fund for electricity projects, Usman said. Electricity transmission projects will get $1.65 billion while hydro-power generation projects will receive $1.72 billion. The fund will be disbursed by the federal government, Usman said.

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