…Records $5bn disbursement
By Emma Ujah, Abuja Bureau Chief
The federal government has secured External Loans worth over $10 billion in the last two years.
Data obtained from the Debt Management Office, DMO indicated, however, that disbursement stood at $5 billion, about half of the secured loans.
The loans were contracted from various multilateral organisations, regional financial institutions, as well as, the International Capital Market, through Eubonds.
Detailed analysis of the debt data showed that the journey of the current administration’s External Loans started with Agence France De Development Euro 103, 896, 806.66 facility for investment in Digital and Creative Economy (i-DICE) which agreement was signed on October 4, 2023. That loan was taken for advancing Nigeria’s computer technology and has an interest rate of 3.50 percent with a moratorium of seven years. It will mature on October 31, 2043.
A loan maturity date is the date on which the final loan payment is due. In other words, the maturity date is when the loan is expected to be fully paid back.
Out of the total loan amount, only Euro 3. 896 million ($4. 211 million) has been disbursed.
UniCredit S.p.A. (formerly UniCredito Italiano S.p.A.) an Italian multinational banking group and the federal government signed a loan agreement of Euro 425. 698 million for the supply of six F.A. Aircraft –Tranche A (Defence). The loan was at 3.85 percent, a four-year moratorium with a maturity date of April 17, 2037. It has, however, remained undisbursed.
The first loan from China under the present administration came from China Development Bank, which gave Euro 883. 451million for the Kaduna-Zaria Rail project. The loan agreement was signed on December 1, 2023 and was given at an interest rate of 4.33 percent and moratorium of five years. It will mature on April 20, 2040. Only Euro 245.198 million ($265. 010 million has so far been disbursed.
In that same December, the government signed a World Bank loan (International Bank for Reconstruction and Development) for Power Sector Recovery Performance-Based Operations (IBRD 1) amounting to $449. 000 million. The loan was given at an interest rate of 6.27 percent, a moratorium of four years and maturing on April 1, 2058. Available data indicated that only $1. 112 million has so far been disbursed.
On that same day, two other loans were given to Nigeria by the International Development Association (IDA) arm of the World Bank. They were XDR 521. 300 million for Adolescent Girls Initiative for Learning and Empowerment (AGILE) AF with 2 percent interest rate and a six-year moratorium. It has a maturity date of August 15, 2053. Only XDR 41. 345 million or $54. 828 million has been disbursed so far.
The second loan by the IDA on that day was XDR 371. 200 million for Nigeria for Women Scale-Up Project. It also has a 2 percent interest rate and a five-year moratorium, thereby maturing on February 15, 2053.
The Islamic Development Bank and the federal government signed a loan agreement for ISD 3. 560 million for Investment in digital and Creative project (i-DICE) IDB at an interest rate of 5.46 percent. It has a moratorium of five years and a maturity date of December 31, 2046. Only ISD 703, 229 ($932, 552.16) disbursed so far.
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