Abuja:The National Sugar Development Council (NSDC) has announced that Nigeria requires a $7.1 billion investment over the next decade to achieve self-sufficiency in sugar production.
According to News Agency of Nigeria, Executive Secretary of the NSDC, Mr. Kamar Bakrin, shared this information during a news conference held for the Commerce and Industry Correspondents Association of Nigeria in Abuja.
Bakrin explained that the investment aims to support existing sugar estates, develop ten proposed new projects, and build necessary infrastructure to boost domestic production. He detailed that approximately 70% of the funds, estimated at $5 billion, are expected from long-term debt facilities and development capital, with an additional $3 billion anticipated from export credit agencies. Other development finance institutions are expected to contribute $1.75 billion, while local development finance sources are projected to provide $250 million. The remaining $2.1 billion is to be supplied by project promoters and operators.
He emphasized that the financing structure is essential due to the unsuitability of commercial lending terms for the sugar industry’s capital-intensive nature. Bakrin highlighted that interest rates between 15% and 28% over five years are not feasible for meeting the industry’s financial needs.
The NSDC has already signed a $1 billion agreement with the Chinese group Sinomach for engineering, procurement, construction, and financing, which will be directed to the estates upon reaching financial close. Additionally, the council has developed similar financing frameworks with Chinese and Indian entities.
Bakrin also mentioned the creation of a 10-billion-naira Sugar Project Acceleration Fund with the Bank of Industry to support feasibility and bankability studies. The council is collaborating with Afro-Asian Bank and other development agencies to facilitate program financing. While not primarily responsible for securing funding, the NSDC is proactively working to source it, Bakrin noted.
He concluded by stating that the council’s performance would be assessed based on measurable results, including the number of cultivated hectares, sugar production levels, and the financing secured for the projects.