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Nigeria to get $1bn Afreximbank loan next month

Published

9 months ago

April 9, 2024

As part of a larger $3.3bn prepayment facility arranged by the African Import Export Bank, Nigeria is set to receive a $1.05bn syndicated loan backed by oil from Afreximbank next month.

The terms of the loan return depend on how much crude oil is sent from the Nigerian National Petroleum Company Ltd. Bloomberg says that Denys Denya, Senior Executive Vice President for Finance, Administration, and Banking at Afreximbank, confirmed that the supply of crude oil had been checked. This means that the balance will be released in full within the next month.

The goal of the loan is to boost Nigeria’s economy and make more hard cash available on the country’s foreign exchange market. There was already money sent out in January for two-thirds of it.

This financial move is meant to give Nigeria immediate cash based on future oil production, which will help the budget of the struggling country.

The African Export-Import Bank gave the Nigerian National Petroleum Company Limited $3.3bn in loans last year. In January, the company said it would pay future fees and taxes to the Federal Government ahead of time.

This was written by NNPCL’s Chief Corporate Communications Officer, Olufemi Soneye, and put out in a paper called “Frequently Asked Questions – Project Gazelle.”

On Monday, Brent, the world standard for crude oil, sold for about $90.63 per barrel. The national oil company said this about the average oil price of $65/barrel for the $3.3bn deal: “This gives us a safety margin in case prices change in the future.”

“NNPC Limited has reserved up to 90,000 barrels of crude for Project Gazelle, ensuring sufficient cash flow for repayment and other financial obligations.

“If oil prices rise, more money will come in from selling the 90,000 barrels, allowing for faster repayment. However, if oil prices fall, the repayment may be slower.

“The quantity of crude earmarked (90,000 barrels) is sized to ensure enough cash is available for the repayment of the facility when it is due. This also ensures that NNPC Limited can meet other cash flow obligations, considering the expected future price of crude oil globally.”

Related Topics:Afreximbank loan Featured Nigeria

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IMF, Egypt reach agreement for fourth review of Egypt’s $1.2 billion loan request

Published

3 days ago

December 26, 2024

Ifeoluwa Dada

Egypt and the International Monetary Fund (IMF) have reached a staff-level agreement over the fourth review of the Extended Fund Facility arrangement, which might lead to a $1.2 billion payout under the program.

In March, Egypt, struggling with rising inflation and cash shortages, consented to the $8 billion, 46-month facility. Its economic problems were made worse by a precipitous drop in Suez Canal revenue over the last year due to regional tensions.

Over the next two years, Egypt’s government has committed to raising its tax-to-revenue ratio by 2% of GDP, according to the IMF, emphasising removing exemptions rather than raising taxes.

According to a statement from the IMF, this would allow it to expand social expenditure to support vulnerable populations.

“While the authorities’ plans to streamline and simplify the tax system are commendable, further reforms will be needed to enhance domestic revenue mobilization efforts,” the statement said.

According to the IMF statement, Egypt had also committed to maintaining its commitment to a flexible currency rate and to taking more urgent action to guarantee that the private sector became the primary driver of development.

The IMF’s executive board still has to accept the fourth review’s staff-level agreement.

VenturesNow

Libya’s eastern govt accepts petrol subsidy elimination

Published

3 days ago

December 26, 2024

Ifeoluwa Dada

In a recent statement, the eastern government of Libya claimed it had reached a consensus on a plan to eliminate gasoline subsidies and would draft a mechanism to carry out the accord.

Additional information on the idea was not released by the administration led by Osama Hamad, a challenger to the internationally acknowledged Tripoli-based government.

However, it is uncertain if Hamad’s government would be able to carry out the plan in the divided nation.

According to the Global Petrol Prices online tracker, a litre of gasoline costs just 0.150 Libyan dinars ($0.03) in OPEC member Libya, making it the second-cheapest in the world.

Following an uprising against former ruler Muammar Gaddafi in 2011, smuggling networks have thrived in the ensuing political unrest and armed fighting. In 2014, conflicting eastern and western governments separated the nation.

A World Bank analysis estimates that the annual value of fuel smuggling from Libya is at least $5 billion.

In a meeting with Mari Barrasi, the deputy governor of the Central Bank of Libya (CBL), located in Tripoli, and four members of the bank’s board of directors, Hamad in Benghazi supported the idea of removing subsidies.

The CBL’s Benghazi branch offices served as the venue for the conference.

The eastern parliament appointed Hamad in 2023 to succeed Abdulhamid Dbeibah, who had been put in position in 2021 under a U.N.-backed procedure that the parliament said had lost its legitimacy.

Dbeibah, who is located in Tripoli, stated in January that he will conduct a public poll on the topic of eliminating gasoline subsidies, but he hasn’t done anything about it since.

According to CBL figures, gasoline subsidies cost 12.8 billion Libyan dinars between January and November of this year. 4.8 Libyan dinars to $1 is the official exchange rate.