Mohammed Shosanya
The Dangote Refinery and Petrochemicals Project will generate 12,000MW of electricity,the Governor of Central Bank of Nigeria,CBN,Godwin Emefiele has said.
He disclosed this on Monday in his remarks
at the Commissioning of the Dangote Refinery and Petrochemicals Complex, Lekki, Lagos,where he also said the project could spare Nigeria about N5 to N7 trillion annually in fiscal expenditure of the federal government over the next five years.
He said the commercial loan component of the US$18.5billiom project was financed majorly by our domestic banks with the balance sourced from foreign banks.
He also said,the Central Bank of Nigeria also partnered, as always, with the Dangote Group in ensuring the successful completion of the project by providing about N125 billion, to cover domestic currency requirements for the venture.
He added:”What you may not be fully aware of, Your Excellencies, is that the Dangote Group has started repaying some of the commercial loans even before the commissioning of this facility. This reflects the commercial capability of the Group and its Chairman. I am pleased to inform everyone today that, following extensive repayments, outstanding debt has dropped appreciably from over US$9 billion to US$3 billion.
” I must at this juncture appreciate all the participating local Nigerian banks, who did not only partner with the project through effective financing but were keenly aware of the importance of the project for our nation. They provided immense support and exceptional understanding, even when interest payments and principal repayment had fallen due”
He said, the refinery and the other ancillary projects will have significant multiplier effects on other sectors of the economy by supporting a diverse range of sectoral value-chains.
According to him,the project avails Nigeria with significant savings both in terms of foreign exchange and in easing the fiscal burden on Federal Government to the tune of $30billion annually.
He said,the impact of this savings will be directly reflected in Nigeria’s foreign exchange reserves by reducing the pressure on our balance of payments,adding that there are also substantial benefits that we will gain from the export of refined products to the rest the world.
He said:”In addition to the nearly US$30 billion foreign exchange savings from the reduction in petroleum imports, the economy is projected to benefit an extra US$10 billion of foreign exchange inflow annually through the export of refined petroleum products, which will further boost our official reserves and enhance exchange rate stability. This project will equally provide support to the fiscal operations of the government as it could help ease budget constraints of funding the petroleum subsidy and engender fiscal savings”
He also disclosed that the Dangote Refinery and Petrochemical Factory which is being inaugurated is a blessing to Nigeria and Africa as a whole.
Favourable spillovers from this project,he said,are also expected to spread from Nigeria to other West African countries and eventually to all countries of the African continent.
The recent endeavours of Alhaji Aliko Dangote confirm that Africans have the capacity to drive the continent’s economic integration, growth, and development, rather than depend almost entirely on foreign investors,he said
He added:”It is in this regard, Your Excellencies, and consistent with the Federal Government’s drive to diversify the economy, that the Central Bank of Nigeria, through its various development finance interventions, has continued to support critical sectors of the Nigerian economy to promote a homegrown rebalancing of our economy and foster self-sufficiency.
” Accordingly, since the refinery will backstop our diversification efforts by exporting its surplus refined products, the CBN supported the project through our Small and Medium Enterprise Refinancing and Restructuring Facility (SMERRF). Under this facility, the sum of N75.0 billion was released for the project through a consortium of banks, in order to bolster value-addition in the real sector, create jobs sustainably, and enhance foreign exchange dynamics.
“The intervention in this project is one of the many efforts of the CBN to support President Muhammadu Buhari’s drive to diversify the economy. We have provided interventions in many critical segments of the real sector, a few of which I will now mention, with your permission”.