Nigeria is currently negotiating a $2 billion loan with the Export-Import Bank of China to finance the development of a new super grid aimed at resolving the country’s longstanding electricity challenges.
The initiative was confirmed on Monday in Abuja by Minister of Power, Adebayo Adelabu.
“It’s part of plans to decentralize power generation in Nigeria” and get the heavy commercial users that left the power grid because of its unreliability to return, he said.
The proposed funding is earmarked for the construction of a high-capacity super grid, which will decentralize power generation and enhance electricity supply to industrial clusters across eastern and western parts of the country.
The project has already received approval from the Federal Executive Council.
The planned loan forms part of a wider effort by the administration of President Bola Tinubu to overhaul the power sector. Recent milestones under this strategy include securing $1.1 billion from the African Development Bank (AfDB) to expand electricity access, a $70 million facility from the International Finance Corporation (IFC) for mini-grid development, and a $328.8 million agreement with China Machinery Engineering Corporation (CMEC) to strengthen the national transmission infrastructure.
In October 2023, the Federal Government signed a separate $2 billion Memorandum of Understanding (MoU) with three Chinese companies to support investments in power generation and the digital economy.
Additionally, unrelated agreements have been signed in other sectors, including maritime and infrastructure development, which some have mistakenly linked to the current power sector loan.
In a separate development, Nigeria and China renewed a $2 billion currency-swap agreement in late 2024, aimed at enhancing trade and investment flows between both countries.
