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Tuesday 04th August 2020,
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FG secures $1.46bn to fund completion of Ajaokuta steel

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By Udeme Akpan

THE Federal Government has secured $ 1.46 billion for the completion of work on Ajaokuta Steel, which has been moribund for decades.

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The Minister of Mines and Steel Development, Arc. Olamilekan Adegbite, who confirmed the development in Lagos, yesterday, said $ 1 billion would come from African Export–Import Bank, while $ 460 million would come from Russian Export Centre.

He said a Memorandum of Understanding, MOU, would be sealed this month to guide the transaction, adding: “Contract Agreement with the Japanese government would also be signed and it would take about two or three years to execute it.”

The Minister said the coming on stream of the company would create many multiplier effects in the nation’s economy, including employment, technology development and conservation of foreign exchange. He said: “Ajaokuta Steel has been on since 1979. For us to industrialize, we need to have steel production in Nigeria. We had done much in the past to start production at Ajaokuta. But somewhere along the line, we missed it and Ajaokuta was never completed.

“President Muhammadu Buhari said we can resuscitate it without spending the revenue that we don’t have. So, we agreed with the Russian government and hopefully by the end of this month, the MOU will be signed.

“The funding will come from Afreximbank  and of course the Russia Export Center. Jointly, they would fund the resuscitation of Ajaokuta and the payback will come from Ajaokuta itself. On completion of work, the plant would be operated by Russian experts, based on terms to be stated in the MOU.” He also said that Nigeria would soon become a major mining destination in the world, especially as the nation was richly endowed with many minerals such as gold, baryte, bitumen and iron ore.

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The Minister said the Federal Government was currently working with many stakeholders, including states, to bring about rapid development of the sector, adding that local and foreign investors would have the needed assistance to establish their investments in the country.

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