The UK\u2019s export credit agency (ECA) has guaranteed a \u00a3746 million (US$902m) loan from Citi to fund the redevelopment of two of Nigeria\u2019s major trading ports.<\/p>\n
The deal between UK Export Finance (UKEF), the Nigerian Ports Authority (NPA) and the Federal Ministry of Finance was signed on March 19, during a visit by Nigerian president Bola Ahmed Tinubu to Downing Street.<\/p>\n
The financing will be coordinated and arranged by Citi\u2019s London branch, and delivered through UKEF\u2019s buyer credit facility programme.<\/p>\n
Citi\u2019s global head of export and agency financing, Richard Hodder, said the lender was \u201cdelighted to support the NPA and the Federal Government of Nigeria in the financing of this critical infrastructure project\u201d and to \u201cdeliver one of the largest ECA-supported buyer credit facilities ever seen in West Africa\u201d.<\/p>\n
The funds will be used to refurbish two of the country\u2019s biggest national maritime infrastructure facilities, with at least \u00a3236mn of supplier contracts directed to British companies.<\/p>\n
British Steel will supply 120,000 tonnes of steel billets to construction companies Hitech Nigeria and ITB Nigeria, a \u00a370mn contract that represents the UK manufacturer\u2019s largest export order backed by UKEF.<\/p>\n
The steelmaker \u2013 which was rescued by the UK government last year \u2013 said the Nigeria contract represented \u201ca major boost to our 4,000 employees\u201d and marked a move \u201cfrom stabilisation to building long-term sustainability for the business\u201d.<\/p>\n
The two ports covered by the deal are the Lagos Port Complex (Apapa Quays) and the TinCan Island Port Complex, also in Lagos.<\/p>\n
\u201cThrough strategic partnerships such as this with the United Kingdom, we are laying the foundation for a new era of efficiency, transparency and competitiveness in Nigeria\u2019s port system,\u201d said Nigeria\u2019s marine and blue economy minister, Adegboyega Oyetola.<\/p>\n
He added the ports\u2019 transformation would see turnaround times for vessels and cargo dwell times fall sharply as automated processes replaces legacy paperwork-heavy procedures, and expanded capacity helps ease bottlenecks.<\/p>\n
\u201cThe modernised infrastructure will enable faster clearance of imports and exports, reduce demurrage and logistics costs for businesses, significantly improve the predictability and transparency of cargo movement and generate more revenue for national development,\u201d Oyetola said.<\/p>\n
Alongside the NPA deal announcement, the UK and Nigeria will sign a memorandum of understanding establishing a framework for \u201cpotential future collaboration\u201d, according to UKEF.<\/p>\n
The memorandum sets out Nigeria\u2019s priority project pipeline and where it will be seeking finance and support from the export credit agency, with the UK \u201cset to benefit directly through substantial supply chain participation\u201d.<\/p>\n
UKEF chief executive Tim Reid said the deal \u201cdemonstrates the full capacity of UK Export Finance to unlock transformational opportunities for British businesses\u201d and laid the foundations for a \u201cdeeper, long-term relationship with Nigeria that will open doors for British exporters across the entire region\u201d.<\/p>\n
The agreement also brings the agency\u2019s total support in West and Central Africa to over \u00a33bn. Earlier this year, UKEF and Citi also worked together on a \u20ac193mn loan<\/a> for a key agricultural project in Uganda, GTR revealed.<\/p>\n The announcements come as UKEF ramps up efforts to support the country\u2019s exporters, including a new \u00a311bn financing package<\/a> targeting SMEs.<\/p>\n