“African Development Bank’s lifeline lifted Nigeria out of recession” – President Buhari
Nigerian President lauds Bank for standing tall among multilateral development banks and international financial institutions.
The African Development Bank provided a much-needed lifeline at a time when it was very difficult to secure budget support loans from anywhere else, as the country struggled with the 2015-2016 economic recession, the Nigerian Government has said.
Speaking to a large audience of senior government officials, private sector, and development agencies as he commissioned the Bank’s world-class office complex in Abuja, Nigeria’s Vice-President, Yemi Osinbajo said the Bank had faithfully filled its role as a trusted advisor and an honest broker in the region and has earned its place as the voice of Africa on development issues.
He described the building as an important symbol of the special relationship between the Bank and Nigeria – a founding member and the largest shareholder of the Bank since its inception in 1964.
Osinbajo, who represented President Muhammadu Buhari, observed that the Bank’s High 5 development priorities, unveiled by African Development Bank President Akinwumi Adesina when he took office in 2015, is right on track – through investments in infrastructure, agriculture, education, health care, and increased access to affordable energy and water.
“Nigeria has been important in the growth of the institution as a major shareholder, donor and borrower all at the same time. And we have through the years shared the Bank’s vision and objectives. Just to underscore the love between the African Development Bank and Nigeria, we have loaned our own Dr. Akinwumi Adesina to the Bank, as he is to our great pride: Nigeria’s first President of the Bank.”
He noted that the Bank had evolved into one of the most efficient vehicles for Africa’s economic development and integration.
“More importantly, the Bank is to be commended for its ongoing efforts to close the gender gap, empower women and youths, and to ultimately strengthen and expand social safety nets for our most vulnerable populations.”
With its large market of over 185 million people, he assured that Nigeria would continue to be an important player in the Bank’s work, advancing efforts to boost regional integration within the Economic Community of West African States (ECOWAS) in particular and Africa as a whole.
“In Nigeria, the Bank has an active portfolio of close to US $6 billion spread over 73 projects across public and private sectors of the Nigerian economy. These projects continue to create thousands of direct and indirect jobs in many parts of our economy.”
He expressed delight that the Bank is working closely with the Government in addressing the challenges faced by communities and people emerging from the insurgency in the northeast and from unrest in the Niger Delta region.
“The Bank approved a budget support loan of US $1 billion in November 2016. The first tranche of US $600 million has been fully disbursed and utilized, and, in my discussions with the President of the Bank, we will be getting the remainder in the form of sector loans, so we are looking forward to the remaining US $400 million,” he said.
“The approval by the Bank sent a much-needed positive signal to the markets at a critical time for Nigeria and for this we will remain ever grateful,” Osinbajo said.
Kemi Adeosun, Nigeria’s Finance Minister, emphasized how the Bank’s lifeline prevented the country’s economy from slipping.
“The signaling effect of that singular act gave the country’s foreign reserves the much-needed boost, which helped stabilized the Nigerian currency – the Naira,” she said.
Nigeria is the African Development Bank’s largest shareholder with a portfolio of approximately US $6 billion and country operations accounting for 13% of the Bank’s total portfolio.
The Minister of Finance expressed Nigeria’s profound appreciation to the Bank for “doing business slightly differently from other multilateral development banks and international financial institutions.
“The African Development Bank rose in support of Africa and Nigeria when it mattered most. His Excellency Vice-President Osinbajo made the point when he referred to the US $1-billion budget support loan for which we have drawn only $600 million,” she explained.
The President of the African Development Bank, Akinwumi Adesina, thanked the Government of Nigeria for its very strong support.
“The Bank strongly supports Nigeria and always will. You can tell by our level of investments in Nigeria to the tune of $6 billion. From our perspective, our investments can only increase, as we expect levels to reach $8 billion by 2019,” Adesina said.
“Our support went beyond money: it demonstrated our strong commitment to help stabilize Africa’s largest economy,” he added.
The Bank, he said, will continue to support critical areas to boost growth, diversify the economy and create jobs in Nigeria. This, he said, includes support for youth in agriculture, small and medium-sized enterprises and the financial sector.
“We will accelerate support for infrastructure and the energy sector. Our investments are structured around our High 5 priorities: Light up and power Africa; Feed Africa; Industrialize Africa; Integrate Africa; and Improve the quality of life for the people of Africa,” Adesina said.
“We’ve invested US $500 million in the Development Bank of Nigeria. We expanded private equity investment in agriculture. We put in $18 million into the Fund for Financing Agriculture in Nigeria (FAFIN). This year, we will be investing this year $200 million in the Transmission Company of Nigeria to support the rehabilitation of existing transmission lines in partnership with the World Bank. We’ve invested $100 million in the Mainstream Power IPP in Jebba and Kanji, to add 700 MW to the national grid.
“Our private sector investment includes US $300 million in Dangote Industries to promote refining of petroleum products, and $100 million to support Indorama Eleme Fertilizer Company as part of a $1.2-billion syndicated financing package that will produce 1.4 million metric tonnes of fertilizers, and expect to generate $2.1 billion in export earnings over the project life. We invested over $134 million in Olam Nigeria Limited in agriculture.”
The Bank, he added, is providing US $263 million toward the rehabilitation of basic livelihoods in the northeast, with the expectation of providing water, sanitation, hygiene and health services that will benefit 14 million people, including 1.9 million Internally Displaced Persons.
The new office building, he explained, makes a bold statement that the African Development Bank is here to stay in Nigeria.
“It sends a strong message that the African Development Bank appreciates Nigeria. And it sends a message that Nigeria’s place in the integration of Africa, especially in West Africa, cannot be ignored. We cannot ignore the fact that Africa’s largest economy is now out of recession and projected to grow at 2.3% this year.
“I highly commend the Government for all the hard work and efforts to change the trajectory of the economy for good. Nigeria’s economy needs to grow at double digit rates to drive down poverty and create a massive number of jobs. That’s why the African Development Bank strongly supports the Economic Growth and Recovery Plan of Nigeria. We were there in the down time, we will also be there for Nigeria in the up time!”