FEC Approves $1.3bn Foreign Loans for Development Bank

• FEC Approves $1.3bn Foreign Loans for Development Bank

The Federal Executive Council on Wednesday approved credit facilities totalling $1.3bn for the newly-established Development Bank of Nigeria.

The Minister of Finance, Mrs. Kemi Adeosun, disclosed this to State House correspondents at the end of a meeting of the council presided over by President Muhammadu Buhari.

Adeosun was joined at the briefing by the Minister of Budget and National Planning, Udo Udoma; Minister of State for Health, Osagie Ehanire; and the Senior Special Assistant to the President on Media and Publicity, Garba Shehu.

Adeosun explained that with the FEC approval, the Federal Government would now seek the National Assembly’s nod before the loans could be accessed.

The breakdown of the credit facilities, according to the minister, shows that the World Bank will give $500m repayable over 21 years; the African Development Bank will provide $450m; the German government-owned KfW Development Bank based in Frankfurt will give $200m; and the French Development Agency will give $130m.

The Finance minister stated, “To access this money, we are ready to disburse but there are two requirements that we need to make, and one of them is the legal opinion of the Attorney-General of the Federation, and the other is the National Assembly’s approval.

“Before it goes to the National Assembly, it needs to be approved by FEC and the FEC simply approved today (Wednesday) that these loan requests should go to the National Assembly for approval so that we can access this money and the Development Bank of Nigeria can take off fully as it is expected to transform financing of our MSME sector.

“The council enthusiastically approved these facilities, which have long tenor, meaning that the DBN will be able to lend to our MSMEs over much longer periods and at much lower rates. So the impact on the MSMEs will be quite considerable.”