China Eximbank provides $460.8 million preferential buyer's credit for Phase 1 of Abuja-Keffi-Akwanga-Lafia-Makurdi Road Reconstruction Project (Linked to Record ID#102678)

Project narrative

On August 18, 2017, China Eximbank and the Government of Nigeria signed a $460,822,440.20 preferential buyer’s credit (PBC) agreement for Phase 1 of the Abuja-Keffi-Akwanga-Lafia-Makurdi Road Reconstruction Project. The PBC (loan) carried the following terms: a 20 year maturity, a 7 year grace period, and a 2.5% interest rate. The final maturity date of this loan is September 21, 2037. The borrower was expected to use the proceeds of the loan to finance 85% of the cost of a $542 million commercial (EPC) contract between the Government of Nigeria's Federal Ministry of Power, Works and Housing and China Harbour Engineering Company Limited. The borrower was also expected to use toll revenue generated by the the road reconstruction project to repay the China Eximbank loan. As of December 31, 2020, Nigeria’s Debt Management Office (DMO) reported that the China Eximbank loan had achieved a 24.42% disbursement rate ($112.53 million) and the borrower had made interest repayments worth $2.88 million and no principal repayments to the lender. As such, the loan’s (principal) amount outstanding, as of December 31, 2020, was $112.53 million. This project involved the expansion of the Abuja-Keffi Road and the dualization of Keffi-Akwanga-Lafia Makurdi Road. The project consisted of two parts: the 5.4 km expansion of Abuja-Keffi expressway, linking Abuja to Nasarawa, and the reconstruction and dualization of the 221.8 km Keffi-Akwanga-Lafia-Makurdi expressway, linking Nasarawa to Benue. The expansion of the Abuja-Keffi expressway was originally expected to last three years, during which a two-lane auxiliary road would be built on the existing six-lane section. The Keffi-Akwanga-Lafia-Makurdi expressway was to be widened from the current two-lane road into a two-way, four-lane section. China Harbour Engineering Company Limited was the EPC contractor responsible for implementation. It hired a local Nigeria subcontractor called M/S Yarsono Partnership Ltd. A formal groundbreaking ceremony took place on November 22, 2018. However, construction did not begin until April 1, 2019. The project was originally scheduled to reach completion within 36 months (April 1, 2022). However, it encountered various obstacles and delays, which resulted in its expected completion date being pushed out to 2023. Phase 1 was ultimately completed in June 2023. Then, in February 2025, the Government of Nigeria officially commenced toll operations on the Abuja-Keffi-Akwanga-Lafia-Makurdi Road. The tolling operation is based upon a 25-year operate and maintain concession agreement that the Government of Nigeria and China Harbour Operations and Maintenance Company Limited in partnership with Messrs Catamaran Nigeria Limited signed in 2023. According to Nigeria Federal Ministry of Works, as of February 2025, saloon cars were to be tolled at N500, SUVs and jeeps at N800, minibuses at N1,000, and multi-axle vehicles at N1,600. Frequent road users, such as commercial light vehicles, were to receive a 50% discount. Tricycles, pedal vehicles, motorcycles, and other small transport modes used by disadvantaged populations were exempted from toll charges.