China Offers $6bn Infrastructure Loan to Nigeria (By Akinrinde, Ibukunoluwa Jeremiah)
China has consented to offering Nigeria a $6 billion infrastructure loan; alongside an agricultural assistance of $15 million for the establishment of 50 demonstration farms across the country. The agricultural assistance aid was granted on the premise of President Buhari’s vow to make Nigeria self-sufficient in food production.
The interest of the Chinese economy in Nigeria, further extends to aspects to education and industry. The Chinese government offered to raise the number of scholarships awarded to Nigerians from 100 to 700 per annum, while offering 1000 Nigerians vocational and technical training by China annually. Similarly, the Chinese government expressed interest in establishing refineries, power plants, mining companies, and textile manufacturing, food processing industries, etc. in the country.
The impact of this bilateral relationship to Nigeria in the interim, is that the loan would cushion the capital expense of the government and help stimulate growth in the presently hailing economy. Also, the prospects of more FDI from China into Nigeria, would mean improved balance of payment, increased economic productivity and more employment activities; thus, strengthening the current administration’s economic objective of import substitution and economic diversification. However, of concern is the long-run impact of this relationship, currency-swap deal with China could expose Nigeria to direct shocks from volatilities of the Chinese economy.