Infracredit, AFD To Support Sub-National Projects In Nigeria

InfraCredit, a specialised infrastructure credit guarantee institution in Nigeria and the Agence Française de Développement (AFD) have signed a Technical Assistance Financing Agreement to support sub- national public -private projects in Nigeria.

According to a statement issued by Onyinye Madu, the press officer of French Embassy in Abuja, under the latter, AFD will provide project preparation and development technical assistance support for InfraCredit’s prospective pipeline of public private partnership (PPP) projects in selected state governments that require support to improve their bankability and attract private sector participation.

“Thus, it will enable them access long-term local currency financing from the domestic debt capital markets. Technical and legal assistance as well as feasibility studies for projects selected in agreement between InfraCredit and AFD will enable, among others, to support the development of infrastructure projects and job creation,” the statement said.

InfraCredit’s Annuity PPP Guarantee was developed to facilitate the sustainable financing of new infrastructure projects alongside subnational governments in Nigeria. Such eligible projects could benefit fom InfraCredit’s guarantee, which can mobilise up to 20-year local currency financing from the domestic debt capital markets.

Speaking on the Agreement, chief executive officer of InfraCredit, Chinua Azubike, stated that to date, InfraCredit’s guarantees have enabled the issuance of up to USD266 Million (NGN Equivalent) of local currency infrastructure bonds, of which 61 per cent include PPP projects.

He however, said that an increasing pipeline of sub-national infrastructure projects requires project preparatory support to deliver well-structured bankable projects that can access the debt capital markets.

“This collaboration will enable state governments to adopt new funding tools and PPP models that will attract and retain the private sector’s financial incentive to invest in viable infrastructure projects.

“AFD’s technical assistance funding will enable InfraCredit to build deal pipelines of well-prepared state government-supported and private sector- led infrastructure projects to be executed,” he said.

Speaking on the Agreement with InfraCredit, Xavier Muron, Country Director of AFD in Nigeria, noted that “This €600,000 grant to Infracredit will finance studies and technical assistance for future infrastructure projects via public-private partnerships throughout Nigeria. Ultimately, it aims at mobilising further the private sector in infrastructure projects.”