Islamic Banking: Nigeria seeks loan from IDB

Nigeria is in talks to secure a $600 million no-interest loan for infrastructure work from the Islamic Development Bank (IDB) , Minister of State for Finance Yerima Lawan Ngama said on Thursday.

Ngama said the loan would be repaid in three to four years, adding that the country’s application for the facility has passed the IDB scrutiny and received positive approval from the Board.

The minister while addressing journalists in Abuja during a meeting with delegates from the IDB said the new loan application will exclude the $370 million private sector loan already extended to Nigeria by the IDB for other developmental project.

According to the minister, the $600 million loan is intended for “investment in social infrastructure and power like the provision of turbines for the Zungeru power station.”

Ngama added that the facilities will also be used for the construction of health centres; urban and rural water works; housing and rehabilitation of some state universities.

“The facility will attract no interest and has a long repayment plan long enough for the recovery of the investment before repayment,” he said.

Nigeria became a member of the Islamic Development Bank in 2005. The country currently holds a $30 billion authorised share capital and an equity stake of $2.28 billion representing 7.6 per cent in the Bank.

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