Nigeria

Nigeria is experiencing remarkable growth. However, the country is faced with a heavy dependence on oil, galloping urbanization, and disparities in wealth. Since 2008, AFD has been working to strike a balance between growth and sustainable development, by supporting the private sector and assisting the country in moving away from total reliance on oil.
woman building Lagos, Nigeria
AFD and Nigeria: 10 years of partnership for a low-carbon and competitive social economy
woman building Lagos, Nigeria

Diversifying the economy

Man walking along the highway in Lagos

Diversifying the economy

Despite the growth, poverty is gaining ground. Over 63% of the population lives on less than $1.4 a day. This means that over 100 million people are living in extreme poverty, including 70 million women. AFD is addressing this situation by supporting the diversification and modernization of the economy. It implements its action through three components:

  1. We contribute to private sector development, through credit lines for job-creating small businesses. Our aim is to extend access for SMEs to medium and long-term credit, by developing a range of financial products tailored to the needs of both banks and companies.   
  2. In 2015, we established a partnership with the Development Bank of Nigeria (DBN).
  3. We also support efforts to mobilize savings, which are necessary to finance infrastructure, by developing appropriate financial products.

In addition to financing, AFD assists the Federal Government and certain Federal States in improving public finance management. How? By increasing tax revenues and improving the economic environment, which is necessary for investments. This includes offering digital solutions (e-governance). AFD may also finance certain public investments in order to promote universal access to telecommunications services.  
 

Supporting the energy industry

An electric relay in Nigeria

Supporting the energy industry

The inadequate energy supply hampers Nigeria’s economic and social development. Electricity demand is at least twice as high as the supply. Nearly all companies need to install autonomous means of power generation to address the inadequacy of the electricity grid. The electricity sector, and more generally the energy sector, was recently privatized and has huge investment needs, especially in the field of transmission.

In 2013, the country’s greenhouse gas emissions were estimated at over 2.5 tons per capita (against 6 in Europe). As part of its contribution to the Paris Climate Agreement (COP21), Nigeria pledged to reduce its emissions by 2030. We are assisting the country in its energy transition, by supporting demonstration projects for the environment in the entire sector, from generation to distribution, and including transmission and vocational training.

Our objective: move away from total reliance on oil. 
 

Investing in rural infrastructure

Nigeria irrigation agriculture

Investing in rural infrastructure

The agricultural sector employs over two-thirds of the working population in Nigeria. Agriculture suffers from shortcomings in a number of areas: inappropriate real estate law, lack of road infrastructure, underdeveloped irrigation, low storage capacity, lack of access to inputs, credit and new techniques, lack of organization of sectors as a whole.

AFD provides its support for:

  1. The development of rural roads to open up rural areas and facilitate the sale of production. 
  2. The irrigation system in the North of the country, a key vehicle for productivity and long-term conflict resolution. 

We also work on strengthening services for farmers, such as access to inputs, credit and the market, and on developing the most promising agricultural sectors.   
 

Developing urban services

Nigeria Transport BRT bus

Developing urban services

The country’s galloping urbanization comes up against a lack of infrastructure in terms of both transport and access to water or sanitation. This intense and unplanned urban growth causes major inequalities between the North and the South, between cities and rural areas, and between formal and informal neighborhoods. 

Since 2010, AFD has been supporting: 

  • The National Urban Water Sector Reform Program. This plan improves access to drinking water, the financial viability of companies, and sector governance by promoting public-private partnerships; 
  • Waste collection and treatment, with priority being given to areas where we are already operating in urban development: Lagos, Kano and the federal capital, Abuja. 
  • The extension of the Bus Rapid Transit (BRT) project, cofinanced with the World Bank

We are also supporting the implementation of the Lagos State Transport Master Plan and Government initiatives for access to housing for households on low or moderate incomes.
 

Facilitating regional integration

Nigeria rice food

Facilitating regional integration

At regional level, Nigeria is the “heavyweight” of the Economic Community of West African States (ECOWAS). It accounts for 50% of its population and over 60% of its GDP. Since 2010, ECOWAS has been benefiting from increasing support from AFD in the fields of food security and agriculture, in the context of ECOWAP, a "regional agricultural policy", adopted in 2005

AFD is supporting four regional projects in partnership with the European Union:

  • Food and Nutrition Security in West Africa (PASANAO);
  • Regional Plan to Combat and Control Fruit Flies in West Africa (PLMF);
  • Regional Food Security Reserve in West Africa (RRSA);
  • The Agroecological Transition in West Africa (PATAE).

Emergency situation: The crisis in Northeast Nigeria

The Northeast of the country is affected by a security crisis due to the conflict with the jihadist movement Boko Haram. Several million people have been displaced and are suffering from serious food insecurity. In 2017, the Borno region is threatened with famine. 

In response to the emergency, AFD is supporting the Lake Chad Inclusive Economic and Social Recovery (RESILAC) project implemented by Action Against Hunger (ACF), in partnership with Care and URD, for displaced persons (on the Nigerian side), refugees (in Chad, Cameron and Niger) and host populations.
 

2008
start of AFD’s activities in Nigeria
1.1
billion euros committed between 2010 and 2017
20
projects financed in 10 years

Nigeria is the most populous country in Africa. It will soon have 200 million inhabitants in its 36 States. Its GDP closely follows South Africa. Nigeria’s remarkable growth potential is based on a stable democratic system and strong entrepreneurial dynamism. It does, however, face huge challenges. It suffers from a lack of infrastructure and needs to organize its transition towards renewable energies. Demographic pressure leads to high unemployment, which undermines social cohesion. The lack of governance exacerbates inequalities and insecurity. 

In less than 10 years, AFD has become a recognized partner in the country, with activities in key sectors, such as energy, water, roads and transport. With over EUR 1.1bn of commitments, we are supporting some twenty projects. 

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