Nigeria’s total borrowing from China at the end of March stood at $3.121 billion (N1.127 trillion at N361/$), the Debt Management Office (DMO) has said.
In a press release issued in Abuja on Thursday, the debt office stated that the country’s indebtedness to China represented only 3.94% of Nigeria’s total public debt of $79.303 billion (N28.628 trillion at N361/$) as of 31st March 2020.
According to the DMO, the total borrowing of $3.121 billion from China at the end of the first quarter of this year are concessional loans with interest rates of 2.50% per annum with a tenor of 20 years and a grace period (moratorium) of 7 years.
“These Terms are compliant with the provisions of Section 41 (1a) of the Fiscal Responsibility Act, 2007. In addition, the low interest rate reduces the Interest Cost to “Government while the long tenor enables the repayment of the principal sum of the Loans over many years.
“These two benefits, make the provisions for Debt Service in the Annual Budget lower than they would otherwise have been if the Loans were on commercial terms,” the document read in part.
The debt office observed that the $3.121 loans were project-tied facilities, covering 11 projects in the country as of 31st March 2020.
It listed some of the projects as Nigerian Railway Modernization Project (Idu-Kaduna section), Abuja Light Rail Project, Nigerian Four Airport Terminals Expansion Project, (Abuja, Kano, Lagos and Port Harcourt), Nigerian Railway Modernization Project (Lagos-Ibadan section) and Rehabilitation and Upgrading of Abuja–Keffi- Makurdi Road Project.
“The impact of these Loans is not only evident but visible. For instance, the Idu – Kaduna Rail Line has become a major source of transportation between Abuja and Kaduna.
“Also, the new International Airport in Abuja, has improved air transportation for the populace, while the Lagos – Ibadan rail line when completed, will ease traffic on the busy Lagos – Ibadan Expressway,” the DMO said.