Wednesday, August 12, 2020

Amaechi says Nigeria will pay in 20 years

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Chibuike Rotimi Amaechi

Transport Minister Rotimi Amaechi says the Nigerian government has the ability to repay loans raised for the construction of railway projects within the stipulated 20-year period.

Amaechi, in a statement on Saturday, said China was the only country to make loans with a low interest rate of 2.8 percent.

He said that no country in the world would grant a loan without a guarantee to repay such loans.

“The trade agreement between Nigeria and China, the transport ministry does not take a loan, everything about the loan is directed to the Ministry of Finance, therefore, I could not have signed any loan because I did not take a loan.”

“What I signed is what is called a commercial contract, which is a contract between the Federal Government and CCECC as a contractor, the contract between Nigeria and China is generally signed by the finance ministry.

“Whether it has been signed by the finance ministry or the transport ministry, the problem is that no one will give you a loan free of charge.

“There must be an agreement and that agreement must contain some terms, that does not mean that you are giving up the sovereignty of the country, no country will sign its sovereignty.”

“What clause 8 says is that I hope you pay according to the terms that we have agreed, if you don’t pay, don’t throw your immunity at me when I come to collect the guarantee presented, that is, all of them.

“We are paying the loans. At the same session of the National Assembly, they were told that of the $ 500 million loan, we have already paid $ 96 million, Nigeria is already paying.

“And the $ 500 million was not taken by us, but by President Goodluck Jonathan in office and that clause was there.

“Nigeria has the ability to repay for a period of 20 years at 2.8 percent, which country will grant you that loan? Second, these loans are not granted to us, they are paid directly to the contractors.

“Once they sign that the work has been done, they pay the contractors and that has never happened before and this project is underway. Are they trying to rule out the fact that there is a railway from Abuja-Kaduna?

“There is no loan in Nigeria, whether internal or external, that is not approved by the National Assembly, none.

“The Chinese government will not even grant you a loan without the approval of the National Assembly because if they grant you a loan without the approval of the NASS, it is on loan,” Amaechi explained.

The minister also said that the government needed the loans to boost infrastructure in the country.

According to him, the sovereign guarantee and sovereign immunity clause raised by the NASS is a term used to guarantee that the collected loans are returned.

The minister said that in case of default, only the assets built with said loan would be recovered.

He said: “What you do is give a sovereign guarantee and that guarantee is the immunity clause that they are talking about.

“When we say, I give you a sovereign guarantee and we get an immunity clause, the immunity clause is that, if tomorrow I cannot pay and you come to pick up the items that we have agreed, these are the items that I am putting as a guarantee, I can Give up my immunity and say no, you can’t touch it, I’m a sovereign country.

“So, they say, if you can’t pay, don’t stop us from recovering those items that will make us recover our funds. So is China our father who will give us free money?

“It is a standard clause in every agreement if the United States signs it, if in Britain, any country would want to know that they can get their money back.

“Anyone who says they don’t know what a sovereign guarantee or immunity is is a shame for the person because it simply means in an operation that I am not giving him this loan free of charge.

“Just like you go to the bank to collect a loan, the moment you don’t pay, they go after your assets you left, that’s all about the clause, the Chinese can never come and take over Aso rock and become President or Minister.

“And if the assets you deposit depreciate, then negotiate what assets they can pursue. The Chinese will never take over what was not built on the loan.”

Amaechi pointed out that it would be unconstitutional to take a loan not approved by the NASS, but due to confidentiality in the government, he would have published the clauses that generate the dust.

The minister, while asking the reason for the NASS investigation, added that they were aware of all the loans.

He said: “The Chinese are only asking us to show them the evidence that we are going to pay, which is the immunity clause. If we don’t pay, they can get their assets back.”

In the Zambian experience, where the country was unable to honor its loan agreement, the minister said the Chinese government will never take over infrastructure that was not built with the money taken.

He also acknowledged that the finance ministry in a repayment plan had started to pay off some of the loans raised.

He said the payment plan was the responsibility of the finance ministry and that the transport ministry should implement the contract.

“They meet the requirements, any time we have to pay, we will pay. It took $ 1.6 billion to fix Lagos to Ibadan, we are asking for $ 5.3 billion to fix Ibadan to Kano.

“$ 3.2 billion to fix Port Harcourt to Maiduguri, then Lagos to Calabar, which is about $ 11.1 billion, if those things were done when we had money, will the infrastructure be here today? The answer is no,” added Amaechi.

However, the minister called on the National Assembly and Nigerians to appreciate the government’s efforts to provide infrastructure in the country.

Amaechi noted that the Itakpe / Warri railway project in the south-south, which was abandoned for thirty-four years by successive governments, was completely rehabilitated by the current administration without applying for a loan.

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