(Recasts with loan, background)
By Felix Onuah
BEIJING, April 12 China has offered Nigeria a
loan worth $6 billion to fund infrastructure projects, the
Nigerian foreign minister said on Tuesday.
The announcement came as both countries signed a currency
swap deal to boost trade. Nigeria has been in talks with China
on an infrastructure loan for months.
Nigeria is Africa's largest economy and its top oil
producer. But its public finances have suffered as the price of
crude oil dropped around the world.
Although President Muhammadu Buhari wants to triple capital
spending in 2016, he also needs to plug a projected deficit of
"It is a credit that is on the table as soon as we identify
the projects," Nigerian Foreign Minister Geoffrey Onyeama told
reporters after Buhari met Chinese President Xi Jinping. "It
won't need an agreement to be signed. It is just to identify the
projects and we access it."
There was no immediate comment from China.
Lin Songtian, director general of the Chinese foreign
ministry's African affairs department, had earlier said Nigeria
would be able to benefit from a $55 billion package for Africa,
which mostly consists of concessional grants or export lines.
The Industrial and Commercial Bank of China Ltd (ICBC)
, the world's biggest lender, and Nigeria's
central bank also signed a deal on yuan transactions.
"It means that the renminbi (yuan) is free to flow among
different banks in Nigeria, and the renminbi has been included
in the foreign exchange reserves of Nigeria," Lin said.
Nigeria had said it was looking at panda bonds -
yuan-denominated bonds sold by overseas entities on the mainland
- to fund the deficit, saying they that would be cheaper than
Nigeria's central bank has said it plans to diversify its
foreign exchange reserves away from the dollar by switching some
into yuan. It converted up to a tenth of its reserves into yuan
five years ago.
Lin said a framework on currency swaps has been agreed with
Nigeria, making it easier to settle trade deals in yuan. China
has signed similar swap agreements with countries ranging from
Kazakhstan to Argentina to promote wider use of its yuan.
Beijing also signed agreements to develop infrastructure in
Nigeria, part of a drive to deepen its ties with Africa.
ICBC agreed a $2 billion loan to Dangote, the
company owned by Africa's richest man, Aliko Dangote, to fund
two cement plants it plans, he told Reuters.
China's Xi told Buhari there was huge potential for economic
cooperation in areas like oil refining and mining, according to
Xinhua, China's official news agency.
In a speech to business leaders, Buhari said both countries
wanted to work together in agriculture, fishing and the
manufacturing of cars, construction materials and textiles.
($1 = 198.8000 naira)
(Reporting by Ben Blanchard and Chijioke Ohuocha, editing by
Larry King; Writing by Ulf Laessing; Editing by Hugh Lawson)