…Agrees currency swap with Nigeria to strengthen Naira
By Amechi Ogbonna
THE Federal Government yesterday said it has received provisional $6billion loan offer from China to fund infrastructure projects across the country.
Nigeria’s foreign Affairs Minister, Geoffrey Onyema who revealed this to journalists covering President Muhammadu Buhari’s state visit to Beijing, China, said on Tuesday that the package does not require any signing of document since its all project tied.
“It is a credit that is on the table as soon as we identify the projects,” he said.
“It won’t need an agreement to be signed; it is just to identify the projects and we access it,” he said.
The $6billion loan pledge comes as part of the gains of Buhari’s visit to China where relations between the two countries are expected to be strengthened.
In 2013, former president Goodluck Jonathan had signed $3billion loan from China at an interest rates of less than 3 percent over a 15-20 year period and targeted at infrastructure development.
Administration folks then estimated Nigeria would need $10 billion investment every year to improve infrastructure like roads and electricity to keep up with a rapidly growing population of over 170 million, and to sustain economic growth at around 6-7 percent.
China has made a string of cheap loans in the past few years to countries in Africa, which rely on oil and raw materials to finance development.
Chinese loans to Nigeria include $500 million to build airport terminals in Lagos, Abuja, Port Harcourt and Kano; and over $700 million to build a hydroelectric power plant in Niger State.
It also includes $600 million to build a light railway in the capital Abuja.
Lending at below market rates to fund infrastructure projects using Chinese firms has enabled Beijing to cement relationships in Africa while subsidising its construction industry.