The International Finance Corporation (IFC) has, alongside its African and European partners, made its largest-ever investment in Northern Nigeria with a financing package to BUA Cement Plc to help the company partly finance and develop two new energy-efficient cement production lines in its Sokkot plant will create up to 12,000 direct and indirect jobs.
IFC’s $500 million financing package includes a $160.5 million loan from IFC’s own account, a $94.5 million loan through the Managed Co-Lending Portfolio Program (MCPP), and $245 million in parallel loans from syndication partners; the African Development Bank (AfDB) – $100 million, the Africa Finance Corporation (AFC) – $100 million, and the German Investment Corporation, Deutsche Investitions- und Entwicklungsgesellschaft (DEG) – $45 million.
The financing, announced during the Africa CEO Forum in Abidjan, Cote d’Ivoire, will allow BUA, Nigeria’s second largest cement producer, to develop new production lines in Northern Nigeria’s Sokoto State. The plants will run partly on alternative fuels derived from waste and solar power. Each will produce about three million tonnes of cement annually, serving markets in Nigeria, Niger and Burkina Faso.
The project is expected to create about 1,000 direct jobs and 10,800 indirect jobs. Direct jobs include those in manufacturing, engineering, and advanced automation systems. Indirect jobs include those in the cleaning, maintenance, mining, and transportation sectors.
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Chairman and Founder of BUA Group, Abdul Samad Rabiu, said, ““BUA is delighted to partner with IFC and other esteemed institutions in securing this $500 million facility to develop energy-efficient cement production capacity and strengthen our equipment and logistics capabilities in northern Nigeria.
“We are particularly pleased to have successfully gone through the rigorous process with IFC, AfDB, AFC, and DEG, which validates our responsible business practices. By focusing on greener fuels and enhancing our equipment and logistics platform, BUA Cement is building a foundation for sustainable infrastructure growth and a more inclusive society.”
IFC’s Managing Director, Makhtar Diop, said, “We are pleased to join with our partners to support BUA with an investment that will boost industrialisation, create jobs and deliver economic growth in northern Nigeria, a region with significant economic potential.”
Samaila Zubairu, CEO and President of Africa Finance Corporation (AFC), said, “Following an initial $200 million investment in BUA Group in 2021, we are proud to play another key role in this landmark manufacturing project set to transform the construction sector in Northern Nigeria and the entire country. By investing in this project, we are sustainably building Nigeria’s local manufacturing capacity, empowering local communities and creating employment opportunities. AFC is committed to working with our partners to accelerate development impact through infrastructure solutions that support value addition, industrialisation, and job creation throughout Africa.”
Solomon Quaynor, Vice President, Private Sector, Infrastructure and Industrialisation at AfDB, said, “The African Development Bank is pleased to be partnering with IFC and BUA on this expansion project as it is aligned with our priority strategies of industrialising Africa and improving the quality of lives of Africans through the increase in cement production which will lead to the development of additional affordable housing and critical infrastructure in Nigeria and neighboring West African countries, while supporting the use of cleaner energy at BUA’s Sokoto facility.”
Senior Director at DEG, Gunnar Stork, said, “DEG’s mission is to be a reliable partner to private sector enterprises as drivers of development and creators of qualified jobs. The significant reduction of CO2 emissions and the creation of decent jobs in a region with many vulnerable households are key factors for DEG’s financing.”
