InfraCredit, a credit guarantee institution specializing in infrastructure in Nigeria and the French Development Agency (AFD) have signed a technical assistance financing agreement to support subnational public-private projects in Nigeria.
According to a statement issued by Onyinye Madu, the press attaché of the French Embassy in Abuja, under the latter, AFD will provide technical assistance for the preparation and development of projects for the potential pipeline of InfraCredit of public-private partnership (PPP) projects in selected state governments that require support to improve their bankability and attract private sector participation.
“Thus, it will allow them to access long-term financing in local currency on the national debt capital markets. Technical and legal assistance as well as feasibility studies of the projects selected in agreement between InfraCredit and the AFD will, among other things, support the development of infrastructure projects and job creation,” the statement said.
InfraCredit’s PPP Annuity guarantee was developed to facilitate the sustainable financing of new infrastructure projects alongside sub-national governments in Nigeria. These eligible projects could benefit from the guarantee of InfraCredit, which can mobilize up to 20 years of financing in local currency on the national debt capital markets.
Speaking on the deal, InfraCredit Chief Executive Chinua Azubike said that to date, InfraCredit guarantees have enabled the issuance of up to $266 million (NGN equivalent) of local currency infrastructure bonds, 61% of which include PPP projects.
He said, however, that a growing pipeline of subnational infrastructure projects requires project readiness support to deliver well-structured bankable projects that can access debt capital markets.
“This collaboration will enable state governments to adopt new financing tools and PPP models that will attract and retain the financial incentive of the private sector to invest in viable infrastructure projects.
“AFD technical assistance funding will enable InfraCredit to build pipelines of well-prepared, state government-backed, private sector-led infrastructure projects to be executed,” he said. he declares.
Speaking about the agreement with InfraCredit, Xavier Muron, Country Director of AFD in Nigeria, noted that “this €600,000 grant to Infracredit will finance studies and technical assistance for future infrastructure projects through public-private partnerships across Nigeria. Ultimately, it aims to further engage the private sector in infrastructure projects.