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April 14, 2024
You are currently viewing AfDB, Indorama sign $75m loan deal to boost fertiliser production, export capacity
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AfDB, Indorama sign $75m loan deal to boost fertiliser production, export capacity

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By Lucy Ogalue

The African Development Bank (AfDB) has signed a 75 million dollar loan agreement with Nigeria’s Indorama Eleme Fertiliser and Chemicals Limited.

The bank announced this in a statement issued on its website late Thursday.

According to the statement, the loan will enable Indorama to increase its fertiliser production and develop a port terminal for exports.

The statement also said that the loan would help in supporting food production and food security across regional and international markets, while fostering job creation in Nigeria.

It said that the expansion would include the development of a third urea fertilizer production line and a new shipping terminal at Indorama’s facilities in Port Harcourt.

“The new production line is expected to have an annual capacity of 1.4 million metric tons of urea, one of the most widely used fertiliser worldwide.

“Indorama’s two operational urea fertiliser lines serve Nigeria’s domestic market.

“It supports the country’s agricultural sector, which accounts for a quarter of its Gross Domestic Product (GDP) and employs about a third of its labour force.

“The new production line and terminal, which will help meet growing global demand for fertiliser, is expected to create up to 8,000 direct and indirect jobs in Nigeria,” the statement said.

The statement also quoted the Acting Director of Industrial and Trade Development Department, AfDB, Ousmane Fall, as commending the partnership.

Fall said the bank was proud of its continued partnership with Indorama, the IFC and other lenders on this critical project.

He said the partnership aligned with the bank’s strategic priorities to Feed and industrialise Africa, while generating significant development outcomes in Nigeria.

Meanwhile, Manish Mundra, Group Director for Africa, Indorama Corporation said the establishment of the fertiliser plant underscored Indorama’s unwavering commitment to Nigeria’s industrial growth, economic diversification and leveraging its strategic geographic location.

“This landmark financing represents a pivotal moment in Nigeria’s journey towards becoming a major player in the global fertiliser market.

“With this third line, Nigeria is prepared to significantly ramp up its export capacity, thereby, enhancing its position as a key exporter of fertiliser to Africa and the world.

“Furthermore, the establishment of this fertilizer plant will not only address critical issues such as broader food security but will also stimulate agricultural growth and create employment opportunities in Nigeria,” he said.

The News Agency of Nigeria (NAN) reports that the AfDB’s loan follows a strategy to support investment in private sector development to promote the growth of the real sector.

The 75 million dolllars loan is part of a 1.25 billion dollars facility arranged by IFC.

The financing package includes a 215.5 million dollars loan from IFC’s own account, a 94.5 million dollars loan through the Managed Co-Lending Portfolio Programme (MCPP), and 940 million dollars in parallel loans mobilised from other development finance institutions and commercial banks.

Some of the banks include the AfDB, Bangkok Bank, British International Investment, Citibank, Deutsche Investitions- und Entwicklungsgesellschaft (DEG), DZ Bank, Emerging Africa Infrastructure Fund (EAIF) and Rand Merchant Bank.

Others are Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden (FMO), Export-Import Bank of India (India Exim Bank) and Export-Import Bank of Korea (KEXIM).

The Standard Bank Group, Standard Chartered Bank and the United States International Development Finance Corporation (DFC) are also part of the banks. (NAN)(Www.nanews.ng)

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Edited by Deborah Coker/Ese E. Eniola Williams

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