US-EXIM Bank supports Nigeria’s power sector with $1.5 billion

US-EXIM Bank supports Nigeria’s power sector with $1.5 billion

A major window of financing for Nigeria’s ailing electricity power sector was on Wednesday unveiled by the United States Export-Import Bank, as it announced a 1.5 billion dollars lifeline for the sector.

Additional financing support for other infrastructure needs of Nigeria to the tune of 220 billion dollars is also to be made available between the year 2012 and 2016.

Reports say the fund, which is packaged as a long term single digit interest rate, is open to all private sector investors willing to buy electricity related goods and services from the United States.

The Agreement

The Nigerian Government and the visiting team from the US-EXIM Bank signed the agreement for the financing window in Abuja, Nigeria’s capital.

At a ceremony witnessed by key officers of the US Embassy in Nigeria and Nigeria’s Embassy in the US, both parties agreed that the facility would commence immediately and called on contractors, independent power producers and relevant stakeholders to come up with bankable requests to access the money.

Signing on behalf of his bank, the Chairman of the US-EXIM, Mr Fred Hochberg stressed that the financing window was just the first of many other infrastructure related support he would be facilitating for Nigeria.

He was quoted as saying: “$1.5 billion is just a start. We want to deploy this financing as quickly as possible to help meet President Goodluck Jonathan’s goals for growing the Nigerian economy by greatly expanding the availability of power in the country. The bank’s board of directors will certainly consider additional financing if needed.”

Job creation

He expressed optimism that the window of financing for American equipment and other related goods and services for the power sector would create a good number or maintain jobs in the US and Nigeria.

US Embassy officials also said “Increased, reliable power in Nigeria is widely accepted as central to the growth of the Nigerian economy. Nigeria intends to increase power output from the current four gigawatts level to 15-20 gigawatts by 2015 and 40 gigawatts by 2020.”

Minister of Power, Prof. Barth Nnaji, stressed that the facility was ready for contractors, independent power producers and relevant stakeholders with bankable projects to access.

He said, “Today is a very important day for us in Nigeria. We are looking forward to you closing the gap of funding of the power sector. We will get the independent power producers to take advantage of this facility to expand their projects in Nigeria. There are also tremendous opportunities in renewable energy for those willing to invest in it.”

NP/Adekusibe/Ekata