Nigeria To Get $1.05bn Oil-backed Afreximbank Loan Balance In May

Nigeria will in May this year receive a $1.05 billion loan from the African Export-Import Bank (Afreximbank), being part of a $3.3 billion prepayment facility arranged by the Nigerian National Petroleum Company Limited (NNPCL), Bloomberg reports.

The funds will be repaid using crude cargoes from the NNPCL.

Recall that two-thirds of the largest syndicated loan raised by Africa’s biggest oil producer was disbursed in January.

Afreximbank’s senior executive vice president for Finance, Administration and Banking, Denys Denya, said the bank has verified the crude availability and would release the balance next month.

He stated, “The verification of the crude availability has happened, so we expect in the next month to finalise the release of the balance. Based on future production, you get the money now.”

This amount is the balance of a $3.3 billion prepayment scheme planned by the African Export-Import Bank, which will be repaid through crude oil shipments from NNPCL.

This syndicated loan will be backed by Nigeria’s oil reserves, providing the country with vital funds to revive its economy and address the shortage of hard currency.

The influx of foreign currency is expected to stabilise the local foreign exchange market, making it easier for businesses to import goods and conduct international trade. This, in turn, could stimulate economic activity and growth.