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The Federal Executive Council (FEC) has approved $200 million loan facilities from the African Development Bank (AfDB) and Africa Grow Together Fund (AGTF) to finance the execution of Nigeria’s electrification project.

The Minister of Finance, Zainab Ahmed, while briefing journalists after the FEC meeting presided over by President Muhammadu Buhari on Wednesday, said the Council approved three memos for the ministry of finance. One of them is “a $150 million facility from the African Development Bank and $50 million loans from African Grow Together Fund to finance Nigeria’s electrification project.”

The AGTF is a $2 billion co-financing fund set up by the AfDB and the People’s Bank of China (PBOC) in 2014, with the goal of providing financing over a 10-year period. The AGTF is used alongside AfDB’s resources to finance eligible sovereign and non-sovereign guaranteed development projects in Africa.

According to the minister, the electrification project is a nationwide initiative that will be implemented by the Rural Electrification Agency (REA). The project, when fully implemented, is expected to provide electricity access to about 500,000 people and 105,000 households.

The project, Ahmed said, has four components, including a solar hybrid mini-grid for rural economic development, appliances and equipment for off-grid communities, energising education, and institutional capacity building.

Last week, the AfDB’s Board approved a $15 million investment package for the Infrastructure Credit Guarantee Company (InfraCredit) to support infrastructure financing in Nigeria through the domestic debt capital market. The investment package comprises of a subordinated loan of $10 million and a risk-sharing facility of $5 million.

The other memos approved by FEC for the Ministry of Finance are $27.3 million IADE concessional loan facility for the North Core Dorsal Regional Transmission Project and $20 million loans from the French Development Agency for the Lagos State Strategic Transport Master Plan.

According to the minister, the regional transmission project is part of West Africa’s power pull priority projects. “The regional transmission project aims to connect Nigeria, Niger, Benin Republic with a high-voltage 330 kilowatts transmission line,” Ahmed said. The objective of the Lagos State Strategic Master Plan, on the other hand, is to “improve the living conditions of inhabitants of Lagos and promote urban development through efficient and effective transport system.”