The Nigerian National Petroleum Corporation (NNPC) Limited
has secured a $3 billion crude repayment loan to support the naira and
stabilise the foreign exchange market.
NNPC Limited secured the crude-for-cash funding from
AFRIEXIM bank headquarters in Cairo, Egypt.
The NNPC will repay the loan with crude oil at an interest
rate between eight percent and 11 percent.
“The NNPC Ltd. and AfriEXIM bank have jointly signed a
commitment letter and Termsheet for an emergency $3 billion crude oil repayment
loan,” NNPC said in a terse statement on Wednesday.
“The signing, which
took place today at the bank’s headquarters in Cairo, Egypt, will provide some
immediate disbursement that will enable the NNPC Ltd. to support the Federal
Government in its ongoing fiscal and monetary policy reforms aimed at
stabilizing the exchange rate market.”
The loan will save Nigeria from approaching the
International Monetary Fund (IMF) for loans, and bring respite to the local
currency, which had depreciated significantly against the dollar over the past
week.
The naira depreciated on Friday to close the week at an
all-time low of N950 to the dollar at the parallel market.
On Monday, President Bola Tinubu met with the acting CBN
governor, Folashodun Sonubi, who said the apex bank will roll out its plans to
stabilise the naira.
The local currency appreciated on Wednesday, recovering from
N950 per dollar to N890 to the greenback.
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