The Nigerian Government has sealed a $350m power financing deal with the General Electric Company, a global power and infrastructure giant to support the construction of small-scale power projects in Nigeria.
The Minister of Industry, Trade and Investment, Olusegun Aganga said this during the signing ceremony in Abuja on Friday January 31, 2014; adding that the deal would fast-track the efforts to provide adequate power to industrial zones as well as small and medium enterprises in accord with the Nigerian Industrial Revolution Plan.
Olusegun Aganga and the Minister of Power, Chinedu Nebo signed the agreement on behalf of the Nigerian Government, whilst the Global Chairman of General Electric, Jeff Immelt and the Chief Executive Officer of Stanbic IBTC, Sola David-Borha signed on behalf of their organisations. The fund is proposed to be managed by Stanbic IBTC, Nigeria.
While speaking at the event, Olusegun Aganga said that the new initiative was in pursuit of the ‘Country-to-Company’ partnership between Nigeria and General Electric towards attracting investments to the critical sectors of Nigerian economy.
The Minister expressed delight over the activities of General Electric, indicating that he is particularly impressed about the $1billion commitment by the Global Chairman/ CEO of General Electric, Jeff Immelt last year towards investing in Nigeria. He added that the commitment became functional in June 2013, when the landmark event held in Calabar to demonstrate that the Country-to-Company partnership between Nigeria and GE to bring investment into the critical sectors of the economy was on course.
“Today, we are signing the $350 million financing deal for small-scale power projects in Nigeria. These small-scale power projects are quicker to do because they can be accomplished within one year. What has happened today is the kind of initiative that we need to drive our economy in terms of providing power to our industrial zones across the country, particularly in Kano where there are big textile industries and the cost of production is not so competitive due to interruption of power supply,” he said.
Aganga further espoused fulfillment over the initiative which he fashioned as aiming to finance the critical sectors that will enhance Nigeria’s economic development. Adding, it will support small and medium enterprises as well as the Industrial Revolution Plan. He described the problem of finance as a big constraint for infrastructural development in Nigeria, saying having this in place will address one of the impediments to growth in the power sector.
“The interesting thing is that GE is not looking at investing in the power sector alone, but is committed to investing in locomotive assembly, establishing healthcare, diagnostic centres and enterprise development. This is why I regard our partnership with GE as a productive Country-to-Company partnership,” the Minister explained.
In his remarks, the Global Chairman/CEO of GE, Jeff Immelt said that the company’s efforts towards investing in Nigeria had been encouraged through the privatization of the power sector, being one of the most transparent globally.
Jeff Immelt said: “GE is a global infrastructure company with businesses in one hundred and sixty countries around the world. Electricity is one of the great enablers of economic growth and development. First of all, I must commend the Nigerian government because I have visited many countries and I want to say that the privatisation programme in Nigeria is one of the best I have seen,” he reiterated.
The GE Boss averred that though the privatisation process is still in its infancy, he has been deeply motivated by the visible structures and pronouncements about happenings. Adding, he has met with many people, internally and externally, who have indicated interest to invest in Nigeria. He noted that technology would be provided by GE, but effort should be made to look at financing as a way of developing the power sector.
Jeff Immelt expressed fulfillment over the relationship between the Nigerian government and Stanbic IBTC regarding debt and equity financing to speed up activities in the sector. He disclosed that the country now has a government programme that is transparent and clearly stated.
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