• Thursday, March 28, 2024
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Nigeria engages Afreximbank in new trade deals for power and healthcare after $2.2bn agreement

Nigeria engages Afreximbank in new trade deals for power and healthcare after $2.2bn agreement

Nigeria has begun engagements with Afreximbank to boost investments in the power and the health sector. This is following a US$2.2 billion trade deals signed between the Afreximbank and the Nigerian government last week.

Sources close to the Nigerian government have told BusinessDay that extensive engagements are ongoing. In an exclusive chat with BusinessDay on the sidelines of the African-Union sponsored Intra-African Trade Fair in Cairo, the Coordinator of Nigeria’s Economic Recovery and Growth Plan (ERGP) Implementation Unit in The Presidency, and Senior Special Assistant to the President, Fola Alayande said that the government is “extremely focused on firing the economy on all cylinders through beneficial trade, and the Federal Government remains committed to following through on all business-friendly trade commitments made to ensure that the benefits trickle down to large corporates and SMEs in the country.”

“Transactions such as the refinancing arrangements for the power sector by Afreximbank would require some innovative structuring deals but this is a major development for the industry. Likewise, the development of industrial parks and special economic zones is an integral part of the nation’s economic plan and the Federal Government remains committed to following through on implementation” Alanyande said.

READ ALSO: Afreximbank wins two EMEA best structured finance awards

Benedict Oramah, President of Afreximbank, during his remarks at the Nigeria Country Day at the inaugural Intra-African Trade Fair co-sponsored by the African Export Import Bank and the African Union had last Thursday announced that the regional exim bank was discussing arrangements to support Nigeria’s power sector and deleverage the banks thereby making it possible for distribution companies sold to private companies to access more funds.

While details of the transaction structure are being worked out with relevant agencies in Abuja, Afreximbank and the African Development Bank had earlier last month during the Africa Investment Forum in Sandton, Johannesburg indicated interests in developing new transaction structures to boost the Nigeria power sector.

Investigations reveal that one of the initial beneficiaries of the Afreximbank support may be Geometric Power in Aba , Abia State that was also one of Nigeria’s largest projects at the Africa Investment Forum. The Governor of Abia State Okezie Victor Ikpeazu, who was one of the two State Governors at the Intra-African Trade Fair, had earlier been reported to hold talks with the AfreximBank on developing the power sector in Abia State and in the South-East in particular to re-ignite the industrial potentials of Aba, leveraging Abia State’s competitive advantage and centralized location that makes access to all South East and South South cities easy.

The planned Aba Industrial Park project is one of the major projects that may benefit from the $1.23 billion deal signed last Thursday to boost special economic zones and industrial parks in Nigeria. Honourable Minister of Industry, Trade and Investment, Okey Enelamah had earlier on at the Fair also confirmed that the country is moving beyond planning to concrete implementation of the special economic zones.

Separately, a senior Afreximbank executive / Afreximbank President hinted that talks were on-going to develop some Centres of Excellence for tertiary healthcare in Nigeria.

Industry observers spoken to commented that Nigeria has maintained a visibly strong presence at African trade and investment fora in the last quarter. At the Intra-African trade Fair, exhibitors from Nigeria were one of the top three country representations similar to the Africa Investment Forum in Johannesburg last month where Nigeria had the second highest deal representation after the host country of South Africa. Folarin Alayande’s disclosed that “The Federal Government has a special delivery unit focused on delivering on the economic recovery and growth plan. We would continue to follow through on high-impact projects that can deliver catalytic growth in the economy.

The AfreximBank Intra-African Trade Fair in Cairo is planned to be a biennial fair with the next one scheduled for 2020. Measured by deals closed and B2B exchanges, preliminary reports from Afreximbank senior executives and Nigerian government officials present indicated that Nigeria had a positive outing and outlook for Nigeria trade in Q1 2019 remains strong.