US, Nigeria sign $1.5 billion electricity financing deal

The US Export-Import Bank on Wednesday signed a deal with Nigeria aimed at providing $1.5 billion in financing for investments in the country's woefully inadequate electricity sector, a statement said.

The deal comes as Nigeria seeks to solve its longstanding electricity shortages by privatising power production and distribution, with outages daily occurrences in Africa's most populous nation and largest oil producer.

Privatisation will open up opportunities for foreign companies, though Nigeria's deeply rooted corruption has often been a stumbling block to successful investment in the country in the past.

Fred Hochberg, the chairman of the bank who visited Nigeria this week, said in the statement that "$1.5 billion is just a start." The bank is an independent government agency that provides export financing to US companies.

"We want to deploy this financing as quickly as possible to help meet President Goodluck Jonathan's goals for growing the Nigerian economy by greatly expanding the availability of power in the country," he said in the bank's statement.

"The bank's board of directors will certainly consider additional financing if needed."

Nigeria intends to boost its power output ten-fold by 2020.

The bank said that Nigeria is one of nine countries it has identified as offering US companies the greatest opportunities for sales.

The other countries are South Africa, Turkey, India, Indonesia, Vietnam, Brazil, Mexico and Colombia, it said.

Nigeria is also a major supplier of US crude imports.