FEC okays $170m French loan. FG floats $300m diaspora bond The Federal Executive Council, FEC, yesterday ratified the approval to the Ministry of Finance to borrow $170 million (N28.7bn) from French Development Agency to boost power infrastructure in the Federal Capital Territory, FCT. The loan which is repayable over 20 years with seven years moratorium, is to enable the government to finance 270-kilometre transmission lines, construction of additional substations within the FCT, and to build additional power substations to boost power supply in the city. Minister of Information, Mr. Labaran Maku, at a post-FEC briefing, told State House Correspondents that the loan is usually given on exceptionally concessionary grounds to developing countries and friendly countries by the French government. According to him, the loan agreement was concluded during the visit of the French President, Francois Hollande, last week to the country for the centenary celebrations. “He noted that Abuja is one of the fastest growing cities in the world and certainly the fastest growing city in the continent of Africa. “We need to continually update infrastructure particularly power supply to the city as it expands from the city centre outwards,” the minister said. According to Maku, the granting of the loan showed the confidence of the French government in the Nigerian economy. He explained that in continuation of the president’s promise to involve all Nigerians, particularly those in the diaspora in the Transformation Agenda, FEC ratified an earlier approval by the President Goodluck Jonathan, which was given to the Federal Ministry of Finance to float a diaspora bond of about $100-300 million to enable Nigerians abroad to invest in the country. Speaking further on the $170 million French loan, the Coordinating Minister of the Economy and Minister of Finance, Dr. Ngozi Okonjo- Iweala, said the terms of the loan would include 1.56 per cent interest rate per annum, commitment charge of 0.5 per cent annually and then a service charge of 0.25 per cent per annum, payable on the amount withdrawn. According to her, the loan would boost transmission of electricity in the power sector “As you know, the ministry of power has set forward an emergency transmission programme for the entire country requiring $1.9billion and we have been able to raise $1.2billion so far of very soft credits. This $170million from the French development agency is part of that package,” Okono-Iweala said. She added: “The balance of the package comes from the World Bank, $700million and the Japanese $200million. We have been able to raise that all very soft credits. “This project has been approved in the borrowing plan since 2010, but after it was approved very early on, it was shelved until we asked the French development agency to renew it and fastback it and that is how we came to approve that today.” ular borrowing programme for the year.
Posted on: Thu, 06 Mar 2014 23:23:20 +0000
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