The Nigeria Investment Promotion Commission (NIPC) has said that a collaboration between the African Export-Import Bank (AFREXIM) and the Nigeria Export-Import Bank (NEXIM) will mobilize early project preparation financing to the tune of $50m through a Joint Project Preparation Fund. This joint venture will also provide technical assistance and mentorships.
Contained in a jointly signed MoU by the two impex banks is that the Joint Project Preparation Fund will create the environment for investments within the manufacturing, export, agro-processing, solid minerals, healthcare, ICT, creative industries sectors of the Nigerian economy.
NIPC said, “the Fund will assist the early development process of projects from concept stage to bankability by covering the preparation of feasibility studies, project development and advisory services and related costs.”
In his speech at the signing of the MoU, the President, AfreximBank, Prof. Benedict Oramah, said, “The execution of this Memorandum of Understanding marks yet another significant milestone in our collaboration with NEXIM.
“I am particularly pleased that Afreximbank and NEXIM are boldly venturing upstream to help investors develop well-structured projects that meet market standards.
“This intervention is timely as the Fund will play a catalytic role in accelerating the diversification of the Nigerian economy by ensuring a steady flow of bankable projects in priority tradable sectors in a timely manner.
“In addition to enhancing bankability, the Fund will, on a case-by-case basis, undertake feasibility studies to assess the viability of accessing markets in the sub-region, thereby promoting intra-African trade under the AfCFTA.”
Mr. Abubakar Abba Bello, Managing Director of NEXIM, in his appreciation of the partnership, said, “The Fund is designed to mitigate the project selection challenges, particularly amongst the SMEs, towards boosting their contribution to formal exports.
“This technical expertise will therefore enhance NEXIM’s implementation of its export development programme, especially with regards to the State Export Development and industrialization initiatives.
“This partnership strongly aligns with the NEXIM’s mandate and strategic plan and will no doubt facilitate its intervention towards attracting critical investments in trade enabling infrastructure and the promotion of value-added exports.”
The NIPC concluded that, “The Joint Project Preparation Fund constitutes a direct response to complement Nigeria’s initiatives to address the twin challenges of the COVID-19 pandemic and existing economic difficulties associated with the country’s dependence on crude oil revenues, which account for 50 per cent of consolidated government revenues, 30 per cent of banking sector credit and 90 per cent of export earnings.
The partnership aligns with Afreximbank’s broader mandate to develop, facilitate and accelerate intra-African trade.”
Azuka Edokobi is a Writer and Entrepreneur