The Federal Government has provided more information on the $1.1 billion loan obtained from the Exim Bank of China, saying it would be used for high priority projects.
According to the Coordinating Minister of the Economy and the Minister of Finance, Dr. Ngozi Okonjo-Iweala, the loan was obtained at an interest rate of 2.5 per cent, which is a far cry from the 16 per cent charged by Nigerian banks.
A statement on behalf of Okonjo-Iweala by her Senior Special Assistant, Paul C. Nwabuikwu, stated that the projects to be funded by the loan are going to be beneficial to the average Nigerian and the country in general.
The projects are the upgrading of four airports across the country, a light rail for the Federal Capital Territory and the Galaxy Backbone.
The statement explained: “The terms at which the soft credit was obtained are very favourable. It is a concessional credit obtained at 2.5% interest, compared to about 16% or higher from Nigerian banks. The repayment period is 20 years with a grace period of seven years.”
Okonjo-Iweala said further: “The projects are high priority, high impact ones which are designed to have practical economic effect and make life better and more convenient for Nigerians from all socio-economic groups.
“For instance, the Abuja light rail project in the Federal Capital Territory will significantly improve the lives of Nigerians especially those in the lower socio-economic groups who have to travel great distances from their homes on the outskirts to their places of work in the city. One part of the intra-city rail network will extend from the city centre to Kubwa and the Nnamdi Azikiwe International Airport. The second will run from the city centre to Masaka in Nassarawa State. Both are high density, high traffic routes.
“The new airport terminals will help Nigeria achieve the status of a hub on the continent and create jobs. The terminals will also help to grow passenger capacity to over 50 million from the current 20 million and increase the number of direct and indirect jobs in the sector to 1.5 million from the current 60,000.
“The Galaxy Backbone, will boost the sophistication and effectiveness of the government’s efforts to tackle security challenges and improve connectivity to modern technology, especially for Nigerian youths in underserved rural areas.”