Nigeria is seeking $5.2 billion from the World Bank to expand electricity generation, PREMIUM TIMES has gathered.
The money is also meant to help the nation’s economy recover from its first contraction in 25 years.
The bank’s private-sector lending arm, the International Finance Corporation, may invest about $1.3 billion in power projects and electricity distribution companies, Bloomberg reports.
According to Power, Works and Housing Minister, Babatunde Fashola, the bank’s political-risk insurer, the Multilateral Investment Guarantee Agency, could provide equity and debt of $1.4 billion for gas and solar power programs, .
The fund is in addition to loans of $2.5 billion Nigeria is seeking from the lender to help improve the distribution of power, expand transmission-capacity and increase access to electricity in rural areas, Mr. Fashola explained.
“Disbursements with the World Bank are being worked out to start from around June, July this year,” Mr. Fashola said.
Nigeria is asking the lender to bring forward the timetables “because next year we want to see results,” the former Lagos State governor added.
The Nigerian economy shrank 1.5 per cent last year, entering its first recession since 1991, occasioned by fall in oil prices and production and dollar shortages.
According to the International Monetary Fund, IMF, however, the nation’s Gross domestic product could expand 0.8 per cent this year and 1.9 per cent in 2018.
Nigeria, Africa’s most populous nation produces about 4,000 megawatts of power compared with an average peak generation of about 35,000 megawatts in South Africa, with a population that’s less than half of the estimated size of Nigeria’s 180 million people.
The lack of power increases production costs for many businesses forced to provide their own electricity, mostly using diesel-run generators.
On Monday, Mr. Fashola lambasted the nation’s power distribution companies, Discos, for epileptic services and breach of agreement.
Earlier, the power companies had alleged, among other issues, that the nation’s power facilities were obsolete, thus frustrating efforts at optimum power generation.
But Mr. Fashola, speaking at a stakeholders forum in Jos, Plateau state, noted that the complaints were unnecessary because they (Discos) were not forced to acquire the asset.
The minister also threatened to sanction erring power distribution companies.