NIGERIA has increased its external debt profile with an additional $1.1 billion borrowed for three projects.

These are the Abuja light rail project, which is to take $500 million; the galaxy backbone infrastructure project which will cost $100 million and four airport terminals which require $500 million.

The facilities attract concessional terms of 2.5 per cent interest over 20 years with a grace period of seven years.

While the necessary protocols for the release of the funds for the first two projects were completed yesterday in China between the Nigerian government and the Chinese Exim Bank, the agreement for the $500 million airport terminals is to be signed soon, according to Mr. Paul Nwabiukwu, the Senior Special Assistant to the Coordinating Minister for the Economy and Finance Minister, Dr. Ngozi Okonjo Iweala in a statement from Beijing, China yesterday after the agreement.

He explained that the credit facility was meant to realise President Goodluck Jonathan’s pledge to boost critical infrastructure in the country, pointing out that the projects which would impact positively on Nigerians, would be completed by 2015.

Nwabiukwu said the commitment of the Chinese bank to the financing of the third project – the construction of four state-of-the-art airport terminals in four cities across the country – had also been obtained and that the agreement would be signed within the next few weeks. The terminals which would cost $500 million would be located in Abuja, Kano, Port Harcourt and Enugu.

The signing yesterday was the culmination of a process which had been on for several months including the approval of the Federal Executive Council and a visit to the Asian country in February by a high-powered Federal Government delegation.

The loan agreement was signed on behalf of Nigeria by Dr. Okonjo-Iweala and Mr. Sun Ping, the Managing Director of China Exim Bank.

The Ministers of Aviation, Stella Oduah, Federal Capital Territory Bala Mohammed, Minister of State for Works, Ambassador Bashir Yuguda were on the team which worked out the final details of the agreement with the officials of the bank.

Also present were Director General, Debt Management Office, Dr Abraham Nwankwo and Special Adviser to the President on Performance Monitoring, Prof. Sylvester Monye.

Explaining the rationale for prioritising the projects, Dr Okonjo-Iweala said that the projects were targeted at making a difference in the lives of Nigerians across socio-economic segments.

“President Goodluck Jonathan is keeping his promise to Nigerians through these important projects. The light rail in Abuja will improve transportation for all residents, especially the working class. The backbone will help to improve service delivery in areas like education and health while empowering the youths with better connectivity to the rest of the world. And the four new airport terminals will, like the others, create jobs and also ensure that Nigerian air passengers enjoy the services and convenience that their counterparts in other parts of the world take for granted.”

The light rail project in the Federal Capital Territory which is at 25 per cent completion would cost $500 million. When completed, the project would significantly improve the lives of Nigerians especially those in the lower socio-economic groups who have to travel great distances from their homes on the outskirts to their places of work in the city.

One part of the intra-city rail network would extend from the city centre to Kubwa and the Nnamdi Azikiwe International Airport. The second would run from the city centre to Masaka in Nassarawa State. Both are high density, high traffic routes.

The new airport terminals would help Nigeria achieve the status of a hub on the continent and deepen employment generation in the sector. The terminals would also help to grow passenger capacity to over 50 million from the current 20 million and increase the number of direct and indirect jobs in the sector to 1.5 million from the current 60,000.

The galaxy backbone would apart from boosting the sophistication and effectiveness of the government’s efforts to tackle security challenges, improve connectivity to modern technology, especially for Nigerian youths.

jamace: Chei Nigerian leaders! Looting,borrowing and looting again. Our leaders have continued to mismanage our resources. What a shame on a wealthy nation like Nigeria.

HNosegbe: Though 2.5% is not a bad rate of interest (assuming there are no hidden charges) and there's a moratorium of 7 years, I still have doubts.

1. Is there any form of quality assurance testing on the materials to be used for the rail project?

2. Who will manage the rails and the airports once work is completed?

3. How do we know the money won't be diverted to somewhere else, or that the projects won't suffer cost overruns?

4. How do we know the projects won't end up on the long list of failing/abandoned projects?

5. Is it a government that cannot account for how much oil we produce that can manage foreign debt?
Until questions like these are answered satisfactorily, I remain skeptical.

HNosegbe: Though 2.5% is not a bad rate of interest (assuming there are no hidden charges) and there's a moratorium of 7 years, I still have doubts.

1. Is there any form of quality assurance testing on the materials to be used for the rail project?

2. Who will manage the rails and the airports once work is completed?

3. How do we know the money won't be diverted to somewhere else, or that the projects won't suffer cost overruns?

4. How do we know the projects won't end up on the long list of failing/abandoned projects?

5. Is it a government that cannot account for how much oil we produce that can manage foreign debt?

Until questions like these are answered satisfactorily, I remain skeptical.

Elueme: 1.Maybe you help govt raise a team of structural and civil engineers to help assess the quality of materials since you got no confidence on what the system can offer.
2. Who are those who have been saddled with the responsibilities of managing these agencies before now? Ok, you intend creating yours for the FG? Ok nau
3 if you ask meee, na who i go ask!!!
4.pls come and help govt account for oil production as well as manage her foreign debt.. Where where you when the ministerial list was drawn...
[b]STOP ASKING DUMB QUESTIONS...

mankevo: Where is OYINLOLA that was ranting RUBISH about A.C.N plunging their states in debt? Am sure he wount see this as "Plunging into debt" because the share will reach him, and certainly sure the repayment term will out-live their administration. MORE DEBT NIGERIA, MORE MONEY IN OUR LOOTOCRACY's Pockets & God for ORDINARY Nigerian!!!!!!!!!!!

Aringon: Let me school you guys on this topic, when any EXIM BANK anywhere in the world finances your project be it private or public projects, they wont give you cash, instead they will convert than loan to supplying the materials, machines that will be used for the project. Like this projects financed by Chinese Exim bank, they Chinese will be the manufacturers of the materials and the rails that will be used for the projects