The Federal Executive Council (FEC) presided over by President Muhammadu Buhari has approved a 500 million Euros loan to finance industrialisation projects and support Micro-Small and Medium Enterprises (MSMES) value chains in Nigeria.
The Minister of State for Budget and National Planning, Mr Clement Agba, disclosed this after the FEC meeting on Wednesday at the Presidential Villa, Abuja.
According to the minister, the loan will be secured from the the Credit Suisse AG London to support industry; revitalise ago-industrial processing zones and facilitate the creation of new jobs.
“Council today approved the issuance of a sovereign guarantee of 500 million Euros from the Credit Suisse AG London Branch and a syndicate of international lenders as collateral for 500 million Euros facility to the Bank of Industry.
“The loan is basically to finance major industrialisation projects and micro-small and medium enterprises value chains in Nigeria for up to five years tenure at affordable rates.
“These rates are single digit rates; the guarantor of the loan shall be the Federal Republic of Nigeria and its going to be executed through the Ministry of Finance, Budget and National Planning.
“The main objective of the loan is to support industry; revitalise ago-industrial processing zones; to facilitate the creation of new jobs.
“We do believe that about 1.2 million jobs will be created through this facility; increase the income of farming communities and promote the inclusion of SMEs and small holder producers in the industrial value chain and the deployment of transportation infrastructure that connect farming communities to processors and market,’’ he said.
Agba said that the loan would be swapped to Naira by the Central Bank of Nigeria to mitigate the foreign exchange risk.
He said that the fund would, therefore, be available to Nigerian enterprises at a more affordable rate and in local currency.
On his part, the Minister of Power, Mr Sale Mamman, said that the FEC approved a memo by the ministry seeking for the release 2 million dollars as part of Nigeria’s contribution to the West African Power Pool.