Nigeria gets N172bn Chinese bank loan for three projects

Minister of Finance, Ngozi Okonjo-Iweala

Projects are in line with government’s policy to obtain facility at favourable terms.

 

The Federal Government on Tuesday in Beijing, China, sealed a $1.1billion (about N172 billion) financing deal with the Export Import, EXIM, Bank of China for three key projects in the transport and Information Communication Technology, ICT, sectors.

The projects, referred to as “high priority impact projects,” include the Abuja light rail system; four airport terminals in Abuja, Kano, Port Harcourt and Enugu; and the Galaxy Backbone, which are all expected to be completed by 2015.

The construction of the light rail project, being handled by the China Civil Engineering Construction Corporation, CCECC, would gulp $500 million; the four airport terminals would take $500million; while the Galaxy Backbone ICT infrastructure will take $100million.

Galaxy Backbone is a Federal Government initiative designed to operate a unified network of ICT infrastructure platform that would take care of the technology connectivity issues of ministries, departments and agencies.

On behalf of the Federal Government, the Minister of Finance and Coordinating Minister for the Economy, Ngozi Okonjo-Iweala, signed the financing deals for the Abuja light rail and Galaxy Backbone. She said the agreement for the financing of the four state-of-the-art airport terminals by the Chinese bank is expected to be signed within the next few weeks.

The Managing Director of China EXIM Bank, Sun Ping, signed on behalf of the bank in a ceremony witnessed by the Minister of Aviation, Stella Oduah; her FCT counterpart, Bala Mohammed and Minister of State for Works, Bashir Yuguda.

The agreement followed the final details worked out with officials of the bank, after several months of negotiations, including the approval by the Executive Council of the Federation (FEC), after a high-powered government delegation visited the Asian country last February.

 

Projects to make a differenc

According Mrs. Okonjo-Iweala, the projects are targeted at making a difference in the lives of Nigerians across socio-economic segments.

“President Goodluck Jonathan is keeping his promise to Nigerians through these important projects,” the minister said.

Mrs. Okonjo-Iweala said the light rail would improve transportation for all residents, especially the working class, and the backbone would help improve service delivery in areas like education and health, while empowering the youths with better connectivity to the rest of the world.  She said the four new airport terminals would create jobs and ensure that Nigerian air passengers enjoy the services and convenience that their counterparts in other parts of the world take for granted.


Facilities attract concessionary terms

The minister said the decision to embrace the financing facility was in line with the Federal Government’s policy of prudence with regard to loans, saying it was obtained on highly favourable concessional terms of 2.5 per cent interest over 20 years, with a grace period of seven years.

The FCT light rail project, which is at 25 per cent completion, would, on completion, significantly impact on the quality of transportation for Nigerians; especially among poor residents, who usually travel long distances, from the outskirts of the city to work, on a daily basis.

 

Facilities would boost tourism

One part of the intra-city rail networks would extend from the city centre to Kubwa and the Nnamdi Azikiwe International Airport, while the second would run from the city centre to Masaka in Nassarawa State, both of which host high density population of residents.

Similarly, the new airport terminals would not only help the country realise the status of a tourism hub on the continent, but also help in growing passenger traffic from the current 20 million to over 50 million, while boosting direct and indirect jobs in the sector from 60 thousand to 1.5 million.

On the other hand, the Galaxy Backbone would boost government’s effectiveness in tackling security challenges and improve connectivity to modern technology, especially for Nigerian youths.


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