Egypt-based Orascom to expand Nigeria investment with $170m Afreximbank facility
EGYPTBASED CONGLOMERATE, Orascom Investment Holding (OIH) has included Nigeria in its pan-African investment expansion drive for which it has secured a $170 million loan from the African Export-Import Bank (Afreximbank).
The North African company is particularly making a sub-Saharan investment push.
Countries to receive the investments include Rwanda, Togo, Eretria, Nigeria and Sao Tome.
Naguib Sawiris, chairman of OIH, said the company’s main focus was currently on investing in Africa; adding that the continent would only achieve progress if intra-African trade and investment growth happened.
Last Thursday, OIH signed a facility agreement lending of $170 million from Afreximbank, a panAfrican multilateral financial institution devoted to financing and promoting intra- and extra-African trade, to assist the company expand its Africa-wide activities in pursuit of its short and medium-term expansion strategy.
Information from Afreximbank quoted Benedict Oramah, the bank’s president, as saying that the transaction was a significant opportunity for OIH’s targeted investments in companies across Africa to support their transformation, increase their production capacity and produce higher quality exports through better value addition, especially in the agroprocessing sector.
The expected multi-milliondollar investment in Nigeria, economic analysts believe, would engender some growth in Africa’s top oil producer, with shrinking foreign direct investment (FDI). Figures from Trading Economics (tradingeconomics.com) said the country received only $435.64 million in FDI in the second quarter of 2018 (Q2 2018), down from $808.56 million in the first quarter.
Oramah, a professor, said the Afreximbank facility agreement with OIH was part of the Bank’s effort to promote intra-African investments and export manufacturing using the framework of its Intra-African Investment Finance Facility (IAIFF).
“The facility would complement ongoing macroeconomic and safety net reforms in Egypt, which seek to foster sector-specific economic growth, especially in strategic sectors with proven record of creating jobs and reducing poverty,” he said.
Oramah said the agreement would set up long-term strategic partnership between Afreximbank and Orascom, describing OIH as one of the most successful and diverse holding companies in the North Africa region, with the potential of assisting the Bank in expanding its operations in the regional and Egyptian markets.
“Our collaboration opens the potential for our two institutions to strengthen their relationship and mutual cooperation in order to make significant contributions towards unlocking the full potentials of intra-African investment,” Sawiris, OIH chairman added.
For him, it was up to Africans to come together to work for that goal, he said; adding that Orascom Investment would explore business and investment opportunities referred to it by Afreximbank in such countries as Rwanda, Togo, Eretria, Nigeria and Sao Tome.
Sawiris commended Afreximbank for the quick turnaround in processing the transaction and for the professionalism and dedication shown by the Afreximbank team. Accompanying Sawiris to the signing ceremony were Tamer Elmahdy, chief executive officer, and Khaled Elleithy, chief financial officer.