Nigeria’s Senate has harmonised the terms of the Federal Government’s 2016-2018 external borrowing plan, and approved the China Development Bank as the new financier for a rail project.
A different Chinese lender had been due to fund the line between Kaduna and Kano –the largest city in the north but it pulled out in 2020.
President Muhammadu Buhari had prioritised upgrading the country’s poor transport infrastructure and power supply since he came into the office 8 years ago. Financing has been a major setback.
The red chamber also approved relevant conditions provided in the harmonised term document.
The conditions include the Kaduna-Zaria-Kano segment, China Development Bank as the financier, 15 years as maturity with 2.7 per cent and six months Euribor as interest rate as well as 0.4 per cent as commitment fee and 0.5 per cent as an upfront fee, respectively.
Parliament has approved several billion dollars’ worth of loans from Chinese and other international lenders but funds have yet to materialise.
