Nigerian President Goodluck Jonathan’s trip to China this week has paid off with a $1.1 billion low-interest loan, a deal that marks continued strengthening ties between the resource-hungry Asian giant and Africa’s second-largest economy and the continent’s largest oil producer.
Chinese President Xi Jinping and the Nigerian leader, who is on a five-day official visit to China, on Wednesday in Beijing announced the deal that will provide the African nation with much-needed capital to invest in infrastructure development. Chinese companies are already building Nigerian roads in contracts worth $1.7 billion, according to the BBC.
In return, China will be importing more Nigerian oil, from 20,000 barrels per day to 200,000 by 2015, Agence France-Presse said. Oil accounts for about 80 percent of Nigeria’s revenue.
“From less than $2 billion in 2000, trade between China and Nigeria reached nearly $18 billion just 10 years later,” said a November 2011 report on China-Nigeria relations from the Organization for Economic Cooperation and Development. “[Nigeria’s] attractions are clear: vast energy reserves and a large domestic market of 150 million inhabitants with growing disposable incomes.”
South Africa is both China’s largest investment target in Africa and the continent’s largest economy, but Nigeria is a close second. The U.S. Energy Information Administration estimates that Nigeria has between 16 billion and 22 billion barrels of proven oil reserves.
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During his trip to China, Jonathan will also inaugurate Nigeria’s new embassy building in the Chinese capital.