Exim Bank of India To Provide $20 Million Line Of Credit To Nexim

AFRICAN-DEVELOPMENT-BANK-GROUPThe African Development Bank (AfDB) Group held its 2011 Annual Meetings in Lisbon, Portugal from 9-10 June 2011, with the participation of finance ministers, central bank governors, development finance institutions, and CEOs from the institution’s 77 member countries.

The meetings, on the theme “Towards an Agenda for Inclusive Growth in Africa”, reviewed the Bank’s 2010 operations and its 2012 development funding portfolio, as well as challenges facing the African region in key areas such as climate change, infrastructure, private sector and governance.

The AfDB is Africa’s premier development finance institution established in 1964 to mobilise resources for the economic and social development of its 53 regional member countries by focusing on reducing poverty and inequality, and promoting sustainable growth. It approved 3,526 loans and grants totaling USD 84 billion from 1967–2010 to these regional member countries.

Delegates representing other multilateral finance institutions, development agencies, private sector chief executives, non-governmental organisations, civil society organisations and the media also attended the meetings. The event marked the 46th and 37th meetings of AfDB and African Development Fund (ADF), Board of Governors, respectively. Key decisions about the Bank Group were made at these meetings.

Nigeria’s Trade Policy Bank and Africa’s Premier Export Development institution – the Nigerian Export-Import Bank (NEXIM) was part of Nigeria’s delegation to the AfDB’s meetings.

The meetings provided a perfect platform for NEXIM MD/CEO, Mr. Roberts U. Orya to hold bilateral meetings with chief executives of other development finance institutions from Africa and beyond. In one of such meetings with the Chairman of Export-Import Bank of India (Exim India), Mr. T. C. A. Ranganathan, Mr.Orya explored issues that would broaden institutional strategic partnership towards enhancing commercial exchanges between Nigeria and India as well as facilitate South-South economic cooperation and trade.

The two institutions have long enjoyed a mutually beneficial relationship which was taken to a new level in September 2007 when the Export-Import Bank of India extended an initial $5m Line of Credit (LOC) to Nigerian Export-Import Bank. Beyond that, both institutions also have a joint collaboration agreement which among others provides for support of Export joint ventures involving Nigerian and Indian businesses in the framework of African Export Import Bank’s (Afreximbank) Export Development Programme.

The meeting provided an opportunity for Mr.Orya to bring Mr.Ranganathan up-to-date on the level of progress NEXIM has made since the transformation process commenced in 2010. 

Relying on the spirit of the robust relationship between the institutions, Mr.Orya requested for the enhancement of the commercial line of credit for the benefit of SME projects that would require Indian technology for production and /or partnership arrangements, especially in the mining, agro-processing and manufacturing sectors of the economy.
On funding intervention to the mining sector, particularly in regard to concessional funding arrangement to support technology transfer and foreign direct investment in mini-cement plants, the NEXIM MD informed his Indian counterpart that useful discussions are ongoing with various State Governments and private sector entities in Nigeria towards establishing a viable public – private- partnership arrangements.

Mr.Ranganathan lauded Mr.Orya for the quick transformation of NEXIM against the background of recent challenges at the Bank and commended the support of the Bank’s stakeholders towards ensuring that the Bank plays it developmental role of trade facilitation and the development of Nigeria’s non-oil export sector.

He further expressed the readiness to share his institution’s experience and expertise on film financing in view of Exim India’s pioneering and lead role in the financing of Bollywood films and entertainment infrastructure in India. This was with a view to enabling NEXIM expands its menu of offerings to the entertainment industry.

He particularly commended the close and fruitful relationship between both institutions and expressed Exim India’s pride to be in partnership with NEXIM Bank. To further augment this relationship, Mr.Ranganathan indicated to Mr.Orya that Exim India is ready to provide NEXIM Bank a USD20m commercial Line of Credit (LOC) to support its efforts in promoting export-oriented activities in Manufacturing, Agriculture, Solid Minerals and Services (MASS) sectors of Nigerian economy.

It would be recalled just recently, on May 26th, the Board of Directors of the African Development Bank (AfDB) Group had approved a sovereign guaranteed Program, in the amount of USD 200 million, to the Nigerian Export-Import Bank (NEXIM) for financing export-oriented Small and Medium-sized Enterprises (SMEs) in Nigeria.

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