The African Development Bank has signed a $75 million loan arrangement with Nigeria’s Indorama Eleme Fertilizer and Chemicals Limited. The bank announced on its website on Thursday.
According to AfDB, the financing will allow Indorama to enhance fertilizer output and build a port terminal for export. It added that the financing would help increase food production and security in regional and worldwide markets and create jobs in Nigeria.
It further stated that the expansion would include constructing a third urea fertilizer production line and a new shipping terminal at Indorama’s facilities in Port Harcourt.
“The new production line is planned to have an annual capacity of 1.4 million metric tons of urea, one of the most often used fertilizers in the world.
It stated that the new manufacturing line and port, which would assist in fulfilling the rising global fertilizer demand, were estimated to generate up to 8,000 direct and indirect jobs in Nigeria.
The announcement also quoted Ousmane Fall, Acting Director of the AfDB’s Industrial and Trade Development Department, praising the collaboration.
Fall stated that the bank was happy with its continuous collaboration with Indorama, the IFC, and other lenders on the project.
He stated that the relationship was consistent with the bank’s strategy priorities of feeding and industrializing Africa while creating primary development outcomes in Nigeria.
Manish Mundra, Group Director for Africa at Indorama Corporation, noted that the development of the fertilizer factory demonstrated Indorama’s steadfast commitment to Nigeria’s industrial growth, economic diversification, and exploiting its advantageous geographic location.
He further said the historic financing marks a watershed point in Nigeria’s drive to become a key player in the global fertilizer market. He added that Nigeria intends to significantly increase its export capacity with the third line, strengthening its position as a leading fertilizer exporter to Africa and the world.
“He shed more light saying the establishment of this fertilizer plant will not only address critical issues such as broader food security but will also stimulate agricultural growth and create employment opportunities in Nigeria,”.
The AfDB’s loan is part of a plan to encourage investment in the private sector to stimulate real sector growth. The $75 million loan is part of a $1.25 billion arrangement provided by IFC.
The funding package includes a $215.5 million loan from the IFC’s account, a $94.5 million loan from the managed co-lending portfolio programme, and $940 million in parallel loans from other development finance institutions and commercial banks.
Some banks are the African Development Bank, Bangkok Bank, British International Investment, Citibank, DZ Bank, Emerging Africa Infrastructure Fund, Rand Merchant Bank, and others.
