US bank to release $1.5b for Nigeria’s electricity reform

US bank to release $1.5b for Nigeria’s electricity reform

Within a year from now, the $1.5 billion credit facility the United States Ex-Im Bank has offered Nigeria will become available to fund reform in the electricity sector.

The US bank’s Regional Director for Africa, Rick Angioni, said in Washington DC that the first release of the funds “would hopefully be starting next year.” He explained that the release of the facility would be done case by case as the power projects come on stream.

Nigeria’s potential

Angioni said the bank was confident about Nigeria’s potential, because two years ago the bank’s president commissioned a five-year strategic plan on the global economic situation and discovered that Nigeria was one of the nine countries with the most promising Gross Domestic Product (GDP) and export potential for the US.

According to Angioni only Nigeria and South Africa featured on the list in Africa.

He added that; “Nigeria being the most populous in Africa, we believe there is no speaking of Africa, without Nigeria.”

According to him, Nigeria has many entrepreneurs, who under a stable polity can make the nation economically robust with already 20 percent of US exports in Africa ending up in the country.

Commendation
Angioni, who was part of the bank’s recent delegation led by its President Fred Hochberg to Nigeria, also credited the Nigerian Ambassador to the US, Prof. Ade Adefuye for making the trip and the agreement possible.

He described Adefuye as a wonderful ambassador, and a shining example of investment diplomacy.

Commending both the Nigerian ambassador to the US and his American counterpart, the US Ex-Im Bank official said Adefuye and his “warm staff” had been very much instrumental to improving US-Nigeria relations.

He said the ambassador was a “great asset to Nigeria,” just as he praised the US Ambassador to Nigeria, Terrence McCulley, saying “we all care about Nigeria being a prosperous country.”

Administering the credit facility

Explaining how and when the bank would administer the $1.5 billion credit facility, the Regional Director said the pace of the ongoing reforms in the electricity sector would also determine the pace of the release of the funding.

He said:“The power sector reforms are still ongoing in Nigeria, we do not know yet when the projects will start, but they are being designed and bidding and the selection process is going on for the assets and implementation of the projects would soon follow.”

US Ex-Im Bank’s commitment

Referring to the $1.5 billion credit facility, the director assured that it was just a step of what the US would do in the Nigerian economy. He noted that there were more steps ahead.
He observed that the view of the US bank is that “the future is very bright for Nigeria and we look forward to working with Nigeria.”

According to Angioni, the US Ex-Im Bank, which is America’s main export trade credit agency, expressed confidence in the Nigerian economy and this he said explained why the bank was investing in Nigeria.

Limitation

The bank director added that what was constraining the Nigeria’s economy now included credit limitations, especially medium term and long-term financing, adding that the bank could be helpful in filling those gaps and such credit facilities would be targeted at building the nation’s infrastructure.

Angioni explained that the electricity sector reform in Nigeria would take about 12 years for it to manifest fully. He stressed that it was why the bank wanted “to provide low cost medium and long term credit facilities to Nigeria.”

Unlike in other countries, where the bank operates, US Ex-Im Bank says it is open in Nigeria to short, medium and long-term financing.

NP/Adekusibe/Williams