Nigeria Borrowed N1.9 Trillion in Two Years - Minister

Nigeria has negotiated various loans totalling $12 billion (N1.86 trillion) in the last two years for both private and public sectors, Coordinating Minister of the Economy and Minister of Finance Ngozi Okonjo Iweala has said.

The figure includes loans from international financial institutions and other creditors such as World Bank, China Exim Bank and African Development Bank

Speaking yesterday at the Ministerial Platform, showcasing the achievements of the ministry in the last two years, Okonjo-Iweala said the financing agreements secured are meant to support the real sector of the economy.

Speaking on the public sector debt profile last week the minister said that "as at now, our external indebtedness is as low as $6.67 billion or about 3 percent of Gross Domestic Product, GDP."
She said the breakdown of the total financing agreement includes N30 billion credit risk guarantee to Nigeria's commercial banks to support the supply of fertilizers and seeds by the private sector, US$ 200 million to support the ATA for staple crop processing in the six geo-political zones and US$ 300 million support to Fadama and commercial agriculture all from the World Bank.

From China Exim Bank the ministry negotiated US$ 500 million for importing 18 cassava processing mills and 40 rice processing units (under discussions), US$ 75 million, Rural Access and Mobility project US$200 million for various roads (under construction), US$500 million for the Abuja Light Rail Project, US$500 million 5 new airport terminals in Abuja, Kano, Lagos, Enugu and Port-Harcourt, US$100 million - National Information and Communication Infrastructure Backbone (Galaxy Backbone), and US$765 million Zungeru Hydroelectric Power Project

From the Islamic Development Bank, Nigeria secured US$17.32 million for science secondary schools in Kaduna State, US$44.69 million - Upgrading of hospital facilities in Kaduna, US$136.34 million - Zaria Regional Water Supply, US$50 million Dam project for water Supply & Irrigation in Osun State and S$70 million to improve and enhance Bilingual Educational Support.

The African Development Bank has granted N50 billion (US$ 330 million) for the construction of the East-West Highway, US$81.32 million - Zaria Regional Water Supply and US$200 million Rivers State Water Supply Project.

Between 2005 and 2006 Nigeria spent $18.1 billion to service debt and secure debt relief from external donors.

The debt relief granted to the country by Paris Club and other foreign creditors facilitated by former President Olusegun Obasanjo was supervised by the Okonjo Iweala in 2005 and 2006.

Last year, Governor of the Central Bank of Nigeria Malam Lamido Sanusi, raised alarm over the nation's rising debt profile and warned that the development, if left unchecked, would result into hardship for Nigerians.

Sanusi, at the Honorary International Investment Council conference in London, argued that if the existing level of borrowing from big nations continued huge debt profile would place "undue burden on posterity."

On the progress made within the period, the minister said as a result of the confidence on the reforms in the country "a number of our banks have gone to raise funds abroad e.g. Access Bank ($350 million Euro Bond), GTB ($350 million Euro Bond) and Fidelity Bank ($300 million Euro Bond)"

Source: AllAfrica