Amidst Nigeria’s rising debt profile and warnings from experts, the federal government, says it is considering taking another fresh external loan of $247.3 million.
Speaking at the end of the Federal Executive Council meeting in Abuja on Thursday, Minister for Finance, Ahmed Zainab said the loan is expected to help bridge the infrastructural gap.
The loan which was approved by FEC would add up to the nation’s existing debt which currently stands at N24.38tn debt.
According to the Minister who spoke to state house correspondents, $150m would come from the African Development Bank (AfDB); $50m from Africa Grow Together Fund and $20m from French Development Agency, which would be loaned to the Lagos State Government.
“Council approved three memos for Ministry of Finance. First, it approved a $150m loan facility from AfDB and $50m loan from African Grow Together Fund to finance the Nigerian electrification project. The project is a nationwide initiative to be implemented by the rural electrification agency.
“The project aligns with the strategy of the Federal Government on electrification of rural communities. The project has four components: First is solar hybrid mini-grid for rural economic development, the second is productive appliances equipment for up-grid communities, and the third is energising education while the fourth component is institutional capacity building.
“The impact of the project when fully implemented, about 500,000 people will be able to have 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.
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“Eight universities will benefit from this scheme and about 20,000 small, micro, medium enterprises across different communities in the nation.
“The second approval is the North Core Dorsal Regional Transmission Project. This is a project that is part of the pipeline for the West Africa power pool priority projects. The intention is for the creation of a regional power pool in the region of West Africa.
”The pool project aims to connect Nigeria, Niger, Benin Republic, Togo, and Burkina Faso with a high voltage 330 kilowatts transmission line, to facilitate energy trade among participants.
“The project is in the total sum of $640m, 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 m IADE facility, 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,” she stated.