FG, China to utilize export-import financing model for Mambilla hydro plant


The Minister of Power, Works and Housing, Mr. Babatunde Fashola, has disclosed that China will finance the construction of a project that would become Nigeria’s largest hydro power plant – the 3,050 megawatts (MW) Mambilla plant – through an export-import financing model, THISDAY reports.

Fashola, who spoke on Arise News – a sister broadcast arm of THISDAY – last Monday in Abuja, explained that Nigeria would shortly negotiate the terms of the financing framework with the Chinese. He said the government was awaiting the office of the Attorney General of the Federation (AGF) to proceed with its negotiations for the finance of the project which he said would cost $5.72 billion to build.

By their nature, export-import financing models which are usually concessional loans, have long moratorium periods of up to five years, in addition to a long tenor that could be as long as 20 years, and very low interests of about two per cent as against the 17 per cent interest on government treasury bills which is one of the funding sources available to the government.