African Development Bank grants $70m loan for Nigerian road project

WCN Editorial Team 29 Apr 2019 AFRICA TRANSPORT INFRASTRUCTURE

The African Development Bank Group has approved a $70m loan for a road project in Ebonyi State, the southeastern state of Nigeria.

The bank is directly providing $40m, while its co-financier, the Africa Growing Together Fund (AGTF), is contributing $30m.

In addition, the Islamic Development Bank is providing Nigeria a loan of $80m, and the Ebonyi State Government is providing $17.60m.

The present loan is expected to cover the rehabilitation and asphalting of a 51km stretch between Nwezenvi and N'Doko, and part of the corridor between N'Doko and Ezzamgbo spanning 38.91km.

The total cost of the project amounts for a total of $167.60m and the construction is expected to be completed in five years, creating approximately 1,400 jobs during the construction phase.

The project is expected to help the agricultural State of Ebonyi to develop special agro-industrial zones dedicated to processing of subsistence crops, in addition to the improvement of road safety and accessibility of farming communities and small-scale industrial areas.

Once completed, the road network is expected to cover a total of 177.81km, and serve as an international link between the State of Ebonyi and Nigeria’s eastern neighbor, Cameroun, in addition to connecting Ebonyi to Benue and Enugu.

The bank said that the project is in line with its High 5s priorities and its commitment to improve the quality of life of Africans by improving accessibility and road safety in its member countries.

The Bank claims that since 1972, it has been financing the transporting projects in Nigeria and has provided the equivalent of $630m in financing the sector, along with a $69.9m facility through the private sector.

Recently, the board of the African Development Bank approved a $15m investment package to InfraCredit comprising a subordinated $10m loan of and a risk sharing facility of up to $5m, to promote local currency infrastructure financing, and further development of the domestic capital market.

The African Development Bank InfraCredit is a specialized infrastructure credit guarantee company, aimed at enhancing local currency debt instruments, to finance eligible infrastructure projects in Nigeria.

The investment in InfraCredit is expected to boost the local institutional investor funds, including pension funds, into financing long-term infrastructure projects through the local bond markets.

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Image: African Development Bank grants $70m loan for Nigerian road project. Photo: Courtesy of Pexels from Pixabay.

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