LAGOS, Nigeria ( VOICE OF NAIJA)- Nigeria is expected to receive $1.05 billion from a syndicated oil-backed loan by the end of May to help revive the economy and improve the foreign-exchange market.
This loan constitutes a portion of a broader $3.3 billion prepayment arrangement facilitated by the African Export-Import Bank (Afreximbank).
Repayment conditions are linked to crude oil shipments from Nigeria’s state-owned Nigerian National Petroleum Company (NNPC) Limited.
Two-thirds of this loan was disbursed in January, demonstrating a strong commitment to stabilising Nigeria’s economy.
Afreximbank’s senior executive vice president for finance, administration, and banking, Denys Denya, verified the availability of crude, paving the way for releasing the remaining balance next month.
This strategic financial move aims to immediately provide Nigeria with funds based on future oil production, offering vital support to the country’s struggling economy.
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For years, Nigeria has grappled with acute foreign exchange shortages, worsened by low crude production and a lack of economic diversification.
Since President Bola Tinubu assumed office in May, the new administration has launched a series of reforms aimed at addressing these challenges directly.
Efforts include addressing a $7 billion backlog of unmet foreign exchange obligations and introducing measures to promote freer trading of the naira, coupled with significant interest rate hikes.
The goal is to attract foreign investors, stimulate economic growth, and stabilize the naira against the dollar.
Additionally, Afreximbank is currently finalizing a $200 million funding plan to back the East African Crude Oil Pipeline project, linking Uganda’s oil fields to Tanzania’s Port of Tanga.
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Despite encountering resistance from climate activists, the project is regarded as crucial infrastructure development that will bolster intra-regional trade, aligning with Afreximbank’s mission.
The bank’s dedication to this initiative highlights its role in promoting trade and economic growth throughout Africa.