Addis Ababa, 13 September 2014 (WIC) – The Board of Directors of the African Development Bank Group (AfDB) held its first regular meeting since the Bank returned to its statutory headquarters in Abidjan on 8 September and approved a combined $256 million for the financing of investments in Nigeria and Ethiopia as well as a multinational projects preparation facility.
A $150 million senior loan will go to Lekki Port LFTZ Enterprise for the construction of a Greenfield seaport in the Lagos Free Trade Zone, about 60 kilometres east of Lagos.
Upon completion the port is expected to handle 16.7 million tonnes of liquid cargo and 4.5 million tonnes of dry bulk. Construction is expected to begin in January 2015, with container terminal operations expected in December 2018.
The project, estimated at $1.675 billion, will be financed through a 54/46 debt to equity ratio
AfDB said in a statement that it is aligned with the Bank’s Nigeria Country Strategy Paper 2012-2016 which stresses infrastructure development in the non-oil and transport sector.
The Bank will also contribute a $5 million equity investment to the establishment of Kukuza Project Development Company (KPDC), a new firm that would focus on early-stage design and preparation of African infrastructure projects.
The company, which will be responsible for contract and financial arrangements as well as investor marketing, expects to process between two and four new infrastructure projects a year.
KPDC’s initial capitalisation is expected to be $25 million with the five equity shareholders – AfDB, India-based Infrastructure Leasing & Financial Services Limited (IF&LS), Abu Dhabi-based Allied Investment Partners, State Bank of India and India Exim Bank – holding a stake of 20 per cent, 20.5 per cent, 20.5 per cent, 19.5 per cent and 19.5 per cent, respectively.
The AfDB Board also approved a $91.1 million loan for Ethiopia’s One Water, Sanitation and Hygiene National Program (OWNP) to provide sustainable water supply and sanitation facilities throughout Ethiopia. Ultimately, the OWNP is estimated to cost $2.4 billion.
Other institutions funding the project include the UK Department for International Development, UNICEF, the World Bank and the Government of Ethiopia. (cpifinancial)