Nigerian President Muhammadu Buhari approved counterpart funding for a deal that will see Siemens AG upgrade the nation’s dilapidated power infrastructure.
Nigeria, Africa’s most populous nation, last year contracted the German engineering company to rehabilitate and expand its electricity grid. Only about two-thirds of Nigerians have access to power and even those are plagued by constant blackouts.
Buhari, 76, granted “anticipatory approval” for 18.94 million Euros, or 15% of the cost, as counterpart funding for the project, Finance Minister Zainab Ahmed said. The balance of 85% will be provided by Euler Hermes Group SAS, and backed by the German government, on concessionary terms with a three-year moratorium, a 12-year repayment period at “an interest rate of Libor-plus 1% to Libor-plus 1.2%.”
The project will be implemented in three phases to be completed by 2025 when Nigeria estimates its on-grid transmission capacity would reach 25,000 megawatts. The West African nation has an installed capacity of 13,000 megawatts, from which only a daily average of 3,500 megawatts is dispatched to consumers due to a poor transmission and distribution network.