African Development Bank (AfDB) yesterday signed a deal to provide two sovereign-guaranteed multi-tranche lines of credit (LoCs) of $500 million and $200 million to the Bank of Industry (BoI) and the Nigerian Export-Import Bank (NEXIM) respectively.
The credit lines are targeted at export-oriented small and medium enterprises (SMEs) modernise and expand export activities in order to create jobs in the economy.
AfDB's Resident Representative in Nigeria, Ousmane Dore, said: "This AfDB combined program will contribute to mobilise significant financial resources for Nigerian export-oriented SMEs, ultimately contributing to economic development, employment opportunities, foreign exchange and regional trade integration".
The LoCs will enhance the competitiveness local SMEs and scale up their operations and ultimately create more jobs in the country.
The current AfDB intervention would include a technical assistance package to strengthen institutional capacity at both BoI and NEXIM as well as at their SME clients.
Managing Director/Chief Executive, NEXIM, Mr. Robert Orya, said in a statement signed by the bank's Head, Corporate Communications, Mr. Chinedu Moghalu, that the LoCs would facilitate its goal of adding about 55,000 jobs to the economy as well as attracting about $1.6 billion in foreign exchange.
He said: "Thanks to AfDB's support through this program, NEXIM seeks important economic development achievements, including approximately 55,000 new jobs for its SME clients, $ 1.6 billion in foreign exchange and an overall contribution of almost seven per cent to non-oil exports, including a 10 per cent share in Economic Community of West African States (ECOWAS) exports.
According to him: "This facility will provide a great opportunity for NEXIM to make available concessional long-term funding in pursuance of its strategic objectives of enhancing value-added exports and bolstering the capacity of SMEs for job creation and foreign exchange earnings."
Also, Managing Director, BoI, Ms. Evelyn Oputu, said: "The AfDB's operation, contributing to capital market development and government revenue, is likely to generate significant additional lending to our export-oriented SMEs client at a time when it is sometimes difficult for commercial banks to finance this important sector of the Nigerian economy."