The federal government's Export-Import Bank announced last week that it once again will insure banks making short-term loans for U.S. sales to Nigeria, after a suspension of more than two months because Nigeria fell behind in its repayments.
About $50 million in pending U.S. sales, mostly of wheat, now can go forward, the bank's statement said.
During the past 2 1/2 years, the bank's short-term transactions have facilitated $733 million worth of U.S. exports to Nigeria, including about $550 million worth of wheat. The West African republic, the most populous on the continent, is a major supplier of oil to the United States and an important customer for American goods.
The Export-Import Bank suspended its insurance, called "short-term cover," on March 31.
Because poor countries now have such a big debt -- estimated at about $1 trillion by the World Bank -- some have fallen into arrears in repaying short-term credit. It is essential to trade because business people may refuse to export goods if they are worried about getting their money.
Jacques de Larosiere, managing director of the International Monetary Fund, has been urging major lenders to resume the short-term loans.
On Tuesday, Nigeria paid $8 million to the Export-Import Bank. The bank said that this payment, together with others received earlier, settles most of its claims against Nigeria going back to transactions made before 1984.World Bank
The World Bank announced a $100 million loan to the government of Hungary and an $81 million loan to Nigeria last week.
The loan to Hungary is designed to accumulate more foreign exchange by producing more farm goods for export and replacing some imports, the World Bank said.
Hungary must repay the loan, which has a variable interest rate, in 15 years.
The Nigerian loan seeks to help improve livestock production. The loan, which also has a variable interest rate, is repayable in 20 years.