Nigeria’s lower house of parliament says it will investigate $2 billion of foreign loans the state-owned national electricity grid operator, the Transmission Company of Nigeria (TCN), may have raised without official approval.
The lawmakers resolve on the probe Wednesday, according to energy analysts, could deal a major blow to efforts to improve Nigeria’s creaking power infrastructure, which is often blamed for hobbling growth in Africa’s largest economy.
Nigeria privatised most of its power sector in 2013 but retained control of the dilapidated monopoly, the TCN.
Simon Arabo, a member of the House of Representatives, said in a motion that the TCN had borrowed $1.5 billion from the World Bank and other international lenders without securing the approval of both houses of parliament as required.
- NIRC calls for better company accounts to attract foreign, Nigerian investors
- CBN September PMI sends early warning sign on state of economy
- IFRSEF calls for Nigeria’s representation at IASB, condemns poor…
- Nigeria's Okonjo-Iweala stays in contention for WTO top post as 3…
- NLC orders Nigeria insurance, bankers’ union to join planned strike
He described the grid operator’s contract processes as opaque and said they may violate procurement laws.
Arabo did not name the other lenders but said TCN is currently negotiating another loan of $500 million with the Islamic Development Bank.
Lawmakers agreed to investigate the activities of the TCN over the past 10 years in respect of foreign loans and contract awards and to report their findings within eight weeks.
The TCN and all the counterparties named in the loans deal, the World Bank as well as the Islamic Development Bank, could not reached at broadcast time.
Nigeria’s ailing power infrastructure has caused blackouts across the country, forcing many businesses and households to run costly fuel generators. If the country’s power plants were to operate at full tilt, the fragile transmission network would not be able to handle the load.
The ongoing developments are despite pledges of the current administration to increase power capacity exponentially and to meet the demands of Nigeria’s more than 180 million people entirely within a decade.