When it comes to Nigeria’s multilateral creditors, the African Development Bank (AfDB) stands out as one of the country’s largest and most reliable sources of credit.
According to data from the Debt Management Office, Nigeria’s loans from the AfDB have increased from approximately $3 billion in 2022 to $3.2 billion by the end of 2023.
This is up from $2.8 billion in 2021, demonstrating steady growth in the extension of credit to Nigeria.
The World Bank is the only multilateral creditor to have extended more credit to Nigeria than the AfDB.
Support from the AfDB has grown significantly since the Tinubu administration, with numerous pledges made over the past year to both public and private institutions, supporting various initiatives.
We looked at the AfDB website and from their records, between 2023 and March 2024, a total of 372.3 million UA has been approved for Nigeria.
For this year, its website showed only 37,548,813 UA was approved on March 15, 2024.
According to the AfDB, the Bank uses a unit of account (the “Unit of Account” or “UA”) equivalent to the International Monetary Fund’s Special Drawing Right (SDR) as its reporting currency.
The value of the SDR, which may vary from day to day, is currently computed daily in U.S. dollars by the IMF.
We also looked at the entirety of projects and amounts that have been approved for Nigeria since 1971 and as per their records, a total of 6.1 billion UA has been earmarked for Nigeria out of which 4.5 billion UA has been approved or completed while 1.4 billion UA is under implementation or ongoing.
186.5 million UA has been cancelled so far while the bulk of the cancellation occurred in 2016 at an estimated 173.8 million dollars.
TheWitness also collated official press releases from the AfDB on pledges made to Nigeria in the form of financial support.
Some of these amounts may be part of the 372 million UA, but TheWitness cannot independently verify.
However, these are the pledges that we have collated.
As part of TheWitness’ review of the government’s first year in office, we take a closer look at the various pledges from the AfDB over the past year, detailing the beneficiaries and the intended uses of the funds.
Here are the pledges made since last year per TheWitness collation:
The African Development Bank (AfDB) had on May 22, 2024, announced an investment of $1.44 billion to aid the development of energy and power, transport, water, and sanitation infrastructure in Nigeria.
On March 28, 2024, AfDB stated it signed a $75 million loan agreement with Nigeria’s Indorama Eleme Fertilizer and Chemicals Limited.
It explained the loan will enable Indorama to increase its fertilizer production and develop a port terminal for exports, supporting food production and food security across regional and international markets, while fostering job creation in Nigeria.
On March 26, 2024, the Board of Directors of the AfDB stated it approved a $50 million loan for the Yobe State Environmental and Climate Change Action Project (ECCAP) to enhance climate change resilience, boost food security, and improve livelihoods for over 3.5 million people in northeast Nigeria.
While the project cost was estimated at $101.34 million, the African Development Bank pledged a $50 million loan.
On February 22, 2024, AfDB stated it committed $80 million in loan financing to the Ekiti Knowledge Zone (EKZ) project in Ekiti State, describing the project as a hub for digital innovation and knowledge economy in Nigeria.
The Ekiti State Government was expected to commit $14.8 million towards the $94.8 million project.
On December 15, 2023, the AFDB said it approved a $175 million financial package for United Bank for Africa (UBA), comprising $100 million in long-term senior debt, $50 million of trade finance medium-term senior debt and a $25 million risk participation program.
According to its statement, the long-term senior debt will enhance UBA’s capacity to finance projects in Nigeria in the key sectors inclusive of agriculture and related value chains.
On December 8, 2023, AfDB said it signed a $20 million Trade Finance Facility Agreement with FSDH Merchant Bank to support small- and medium-sized businesses in Nigeria’s industrial and manufacturing sectors.
On June 30, 2023, AfDB stated it had approved a loan of $115 million to support a major road rehabilitation project in Nigeria’s Abia State.
“Financing for the project, estimated at a total cost of $263.80 million, will come through an African Development Bank loan of $100 million; a Canada–African Development Bank Climate Fund (CACF) loan of $15 million; and a $125 million co-financing loan from the Islamic Development Bank,” AfDB said in a statement.
On May 18, 2023, AfDB stated it approved a $15 million subordinated loan to Infrastructure Credit Guarantee Company Limited (InfraCredit) to strengthen its capital base and help close Nigeria’s infrastructure financing gap.
The financing was aimed at enabling InfraCredit to leverage domestic capital markets to bolster access to long-term local currency infrastructure financing in Nigeria.
