Buhari China

Nigeria Denies Ceding Sovereignty to China Over Loans

The Federal Government of Nigeria yesterday debunked claims that the President Muhammadu Buhari administration is giving part of Nigeria’s sovereignty to China in exchange for loans.

It was reacting to allegations made by chairman of the House of Representatives Committee on Treaties and Agreements, Ossai Nicholas Ossai, that the Nigerian government may have ceded the nation’s sovereignty to China in the event of a default in loan agreements signed with the Asian country on Tuesday.

Ossai had raised the alarm over lethal clauses in Article 8 (1) of the commercial loan agreement signed between Nigeria and Export-Import Bank of China which indirectly “wills the sovereignty of Nigeria” in the $400 million loan for the Nigeria National Information and Communication Technology (ICT) Infrastructure Backbone Phase II Project signed in 2018.

But refuting the claim, the federal government said members of the National Assembly were aware of the $5.3 billion loan and all the clauses currently under scrutiny by the transport committee, as the loan proposal was actually approved by them.

Stating the government position during a television programme yesterday, minister of Transportation, Rotimi Amaechi, denied the assertion that the loan amounts to giving Nigeria’s sovereignty to China.

The minister explained that the clause under scrutiny simply gives China the right to take over the property that the loan was used to construct.

He said, “I have told the House of Reps; the clause is a simple one. For example, the loan to construct Ibadan to Kano rail is $5.3 billion. The implication is that if by the end of the day you don’t pay back our money, whatever we need to take from you, we will take from you.

“But what the Chinese normally do is that they go after the same asset to recover their money. So what is wrong with that? You are asking for $5.3 billion. The sovereignty you give to them is to allow them to take over a property in your country. It is not a personal thing but something of national interest.

Now for me, if the National Assembly in their wisdom, going by the constitution, think that it is wrong, then they should tell us how to get the money to build these infrastructure because if the infrastructure was built before we came, we are not mad, we will go to something else.

“Remember that the Goodluck Jonathan government took some loans to do the Abuja-Kaduna rail service and the current administration decided to do the Lagos-Ibadan and now, we are seeking for the loan to link it to Kano so that we can have Lagos to Kano and move our containers.

“I have also told the National Assembly that there is nothing wrong with the investigation. It is part of their responsibilities but for now they will jeopardize the ability of the government to raise money if we continue to ask questions that will make China raise an eyebrow and start wondering what is wrong.

“This means that we may lose the loan for the Port Harcourt-Aba, Umuahia, Enugu, Markurdi, Gombe, Jos, Damaturu, then Maidugurri project. We will also lose the money you are asking for the Ibadan-Kano project which includes Ilorin, Minna and Kano.

“And then the loan for Lagos to Calabar being pursued with the Russians may also be lost and the areas covered include Ore, Bennin to Asaba, Onitsha, Warri, Uyo, Calabar. Do they want us to lose these loans because they are afraid of losing sovereignty? It is not ceding sovereignty in the technical sense of it, but giving them power to cease their assets in other to recover their money, so there is nothing wrong with that.”

On the mapped out plans for the repayment of the loans, the minister said the ministry of Finance handles part of that aspect as the job of the ministry of Transportation was to implement government policies.

He however noted that Nigeria was not defaulting on the payment plans yet, even as he urged successive governments to continue with the payment plans.

The minister explained: “We have already opened an escrow account to pay in the money. The minister of Finance sent me the account details for the NRC to start paying in the money.

“So if we are making N100 million and we are running with N90million we can start paying N20-30 million monthly and before we know it, we can raise $1 million that we can send to the minister of Finance to pay as our contribution. The idea is to open an escrow account, remove the running cost and the profit can go into the loan repayment”.


Follow us on Twitter at @thesignalng

Copyright 2020 SIGNAL. Permission to use portions of this article is granted provided appropriate credits are given to www.signalng.com and other relevant sources.

There are no comments

Add yours