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InfraCredit Secures $15M Loan from AfDB to Boost Nigeria’s Infrastructure

InfraCredit Secures $15M Loan from AfDB to Boost Nigeria’s Infrastructure

African Development Bank (AfDB), has approved a $15 million subordinated loan to bolster Nigeria’s Infrastructure.

The credit facility from Infrastructure Credit Guarantee Company Limited (InfraCredit), seeks to strengthen InfraCredit ‘s capital base.

Furthermore, he capital injection aims to close Nigeria’s infrastructure financing gap.

AfDB’s Nigeria’s Director General, Lamin Barrow explained that the financing is set to leverage domestic capital markets. This, he added, will bolster access to long-term local currency infrastructure financing in Nigeria. 

“The AfDB is pleased to continue to support an innovative financial institution – InfraCredit –which has objectives that align closely with our priorities to mobilize institutional financing for the delivery of infrastructure for Nigeria in key sectors including transport, energy, water, agriculture and infrastructure.”

Another boost for Nigeria’s Infrastructure

This complements a 2019 investment into InfraCredit by AfDB and other partners to unlock domestic institutional capital for infrastructure. 

Moreover, InfraCredit is seeking to raise capital to finance an additional $375 million in infrastructure over the next few years, by leveraging private sector financing.  

Chinua Azubike, InfraCredit CEO said, currency infrastructure finance in Nigeria will create jobs and support local economic growth. 

In addition, the investment will strengthen Nigeria’s guarantee issuing capacity and bring AfDB’s total investments in InfraCredit to $25 million.

This is a strong signal of its commitment to the long-term growth of InfraCredit and the country’s economy.

The partnership advances a number of strategic objectives under the Bank’s current Country Strategy Paper for Nigeria.

It includes helping to stimulate local currency bond market financing across diverse infrastructure sectors and enhancing economic diversification and competitiveness.

The strategy also prioritizes delivery of infrastructure for transport, energy, water and sanitation, agriculture, industry and social development.

InfraCredit Aligning with Nigeria’s agenda  

The intervention also aligns with the Nigeria’s National Development Plan which envisages strong private sector resource mobilization.

Furthermore, it allows participation in the delivery of the priorities of the plan including for investment in infrastructure, promotion of financial sector and capital market development.

By de-risking local currency debt instruments, InfraCredit channels financing to infrastructure projects, including green and climate-aligned projects in Nigeria.

This will promote low-carbon development and mitigation, leveraging climate finance from private the sector sources.

Nigerian Sovereign Investment Authority founded InfraCredit in 2016 in collaboration with GuarantCo (part of the Private Infrastructure Development Group).

It is a specialized Nigerian credit guarantee company that mobilizes long-term capital from institutional investors to support infrastructure projects.

In February, African Heads of States met Addis Ababa where they rooted for sustainable development during AU Summit.