African Export-Import Bank (Afreximbank) has signed a Memorandum of Understanding (MoU) with the Bank of Industry (BOI) for the establishment of a Joint Project Preparation Facility (JPPF) that will provide early-stage project preparatory financing and technical support services to public and private sector entities operating in Nigeria.
Under the MoU signed on November 3, 2022, Afreximbank and BOI will mobilize resources to unlock investments into sectors such as energy, transport and logistics, ICT, special economic zones, industrial parks, solid minerals and services (healthcare, hospitality and tourism, and the creative economy).
The MoU, which was signed by Oluranti Doherty, director – export development, Afreximbank and Olukayode A. Pitan, managing director and chief executive officer of BOI is intended to de-risk projects and attract critical private sector investments that will stimulate industrialization and spur value-added exports in the country. The JPPF constitutes a direct response to complement Nigeria’s initiatives to address the twin challenges of the COVID-19 pandemic and existing macro-economic challenges associated with the country’s dependence on crude oil revenues, which account for 50 percent of consolidated government revenues, 30 percent of banking sector credit and 90 percent of export earnings.
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Kanayo Awani, executive vice president -Intra-African Trade, Afreximbank, commented: “We are quite pleased by this opportunity to, once again, partner with BOI in proffering a solution to one of the major challenges that have impeded the flow of investments that will boost Nigeria’s industrial development and export-oriented sectors. I am particularly pleased that Afreximbank and BOI are boldly venturing upstream to help investors develop well-structured projects that meet market standards. This intervention is timely as the JPPF will play a catalytic role in accelerating the diversification of the Nigerian economy by ensuring a steady flow of bankable projects in priority tradable sectors in a timely manner. In addition to enhancing bankability, the JPPF will, on a case-by-case basis, undertake feasibility studies to assess the viability of accessing markets in the sub-region, thereby promoting intra-African trade under the AfCFTA.”
Olukayode Pitan, managing director and chief executive officer of BOI, commented: “In line with our commitment to driving Nigeria’s industrial transformation, we are delighted to commence this partnership which stands to achieve significant sustainable economic development in Nigeria.
Through this Memorandum of Understanding, we will harmonize efforts with Afreximbank for the promotion of trade and investment flows; undertake business development activities; and share project preparation pipelines in sectors of mutual interest. We will also be better-positioned to provide technical, financial and legal services that will culminate in the supply of bankable projects, while promoting and raising awareness of project preparation activities in Nigeria and Africa at large.
“Our participation in the JPPF will therefore unlock development impacts such as quality jobs, FX generation and savings, and technology transfer,” Pitan said.