Nigeria’s president Muhammadu Buhari, is seeking parliament’s approval for a proposal to borrow $5.85 billion from China to modernize its rail network and another $1.075 billion from the World Bank to help rebuild the insurgency-torn northeast.
In a letter to parliament, the president urged the lawmakers to approve the railway borrowing because China has a limit on funds available from its China Africa Fund. The president wants to sign the loan agreement as soon as China approves the project.
Buhari also asked parliament to approve a $1.075 billion loan from the World bank to help rebuild the country’s north east region that has been ravaged by the Boko Haram insurgency, now in its 8th year.
The loans are part of the government's 2016-2018 foreign borrowing plan
“These loans form part of the overall money for the rail strategy,” Buhari said in the letter. “The loans are part of the government’s 2016-2018 foreign borrowing plan,” he added.
According to the letter, China Exim bank has approved a $1.231 billion loan to modernize the rail network linking the commercial hub of Lagos in the south to the industrial city of Kano in the north and also a Lagos to Ibadan segment.
The west African economy is in its second year of recession brought about by low oil prices, which have slashed government revenues, weakened the naira currency and caused chronic dollar shortages.