Nigeria Secures $550M To Fund Two Satellites

Nigeria secures money from China to fund two more satllites

 The Minister of Communications, Mr. Adebayo Shittu, has disclosed that Nigeria had secured the commitment of China for the provision of $550 million towards the purchase of two additional satellites for subsequent launch into the space in the next two years.

Shittu, who made this disclosure in the State House after a meeting with President Muhammadu Buhari, said both the China Exim Bank and China Great Walls, the manufacturers, had agreed to fund the project 100 per cent following Nigeria’s inability to fulfill the initial agreement it reached with China to provide 15 per cent of the $550 million.

According to him, Nigeria’s satellite communications have hitherto been ineffective because the federal government-owned satellite company, NigComSat, has only one satellite which he said could not guarantee the confidence of prospective customers.

The trend, he said, compelled companies operating in Nigeria to purchase satellite communications data abroad, adding that after the formal signing of agreement for the take-off of the project which he said would take-off on January 27, the manufacturing of the satellites will commence.

He added that after the formal manufacturing process has eventually commenced, it will take another two years for the launch of the satellites which he said was conceived to take the entire satellite communications market in Nigeria and the entire African continent.

Shittu who also said the president was excited by the development, pointed out that the president was however, not surprised by the output of the renegotiation which saw China agreeing to funding the entire project, saying China knew the immense potentials embedded in the Nigeria’s satellite communications market.

He further explained that the sum of $550 million fund is not a loan but rather an equity which he said would be predicated on profit sharing agreement between Nigeria and the Chinese companies adding that Nigeria will not be outwitted in the sharing of the profit because it has brought nothing to the table as he explained that profit will be shared on the basis of an agreed ratio.

“I’m in the presidency to see the president and l am happy that l was well received to brief him on three major issues. Number 1 is the fact that Nigcomsat is one of our agencies where we hope to procure two new satellites for Nigcomsat from China. Initially, the agreement was that they would provide the cost of the two satellites at the cost of $550 million minus 15 per cent which is to be the counterpart fund. Because we could not afford this 15 per cent, we have renegotiated with China Exim Bank and China Great Walls, the manufacturers, and they have happily agreed to pay the extra sum of $550 million to provide two new satellites. Already, we have one satellite over the last seven years. Having two new ones is to ensure that the Nigerian satellite company can conquer the entire African continent with regards to the provision of satellite communication services. It is a very big business opportunity and I am sure that the Chinese appreciate the potential market that is so versed and that is why they agreed in spite of our inability to provide 15 per cent, that they are prepared to bring the entire sum of $550 million for the procurement of the two satellites.”

Asked if Nigeria would intervene in the seizure of Globacolm operating licence in Benin Republic, he said the government had not been notified and would not intervene unless Globacolm formally launches a complaint with it.

“Well, it has not been brought to out notice. Globacolm is a private Nigerian company which has right to offshore business. If they approach us, that means we must intervene but the first thing must come from the company first on whatever is happening in Benin Republic,” he added.

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