House of Reps seeks review, cancellation of Chinese loans to Nigeria

House of Reps seeks review, cancellation of Chinese loans to Nigeria

- House of Representatives is seeking to review or push for outright cancellation of the latest Chinese loans to Nigeria

- The House wants to investigate China/Nigeria loan agreements since 2000, with a view to renegotiating them

- It said the National Assembly had been put in the dark on how most of the loans were collected and utilised

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The House of Representatives has demanded a review or outright cancellation of the latest China loans to Nigeria on the principle of ‘force majeur’ in the light of the COVID-19 pandemic which started in China.

The lawmakers added that the National Assembly had been put in the dark on how most of the Chinese loans were taken and utilised.

The green chambers, therefore, mandated some committees to look into all extant China-Nigeria loan agreements since 2000 with a view to ascertaining their viability, as well as regularising and renegotiating them.

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House of Reps seeks review, cancellation of Chinese loans to Nigeria

Lawmakers in the green chambers say they are not aware how the loans were utilised. Photo credit: House Committee on Media
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The decision of the House followed the adoption of a motion on the need to review and renegotiate existing China-Nigeria loan agreements, which was moved by Honourable Ben Igbakpa at the plenary on Tuesday, May 12.

Honourable Igbakpa said there was widespread global concern about the alleged fraudulent, irregular and underhand characteristics of Chinese loan contracts with African countries, which has resulted in a new form of economic colonialism foisted by China.

The lawmaker said as at the last count, Nigeria had obtained 17 Chinese loans to fund different categories of capital projects, and Nigeria would still be serving the Chinese loans till around 2038, the maturity date for the last loans obtained in 2018.

The lawmaker expressed concern that International Monetary Fund had raised the alarm that most of the Chinese deals are not Paris Club compliant, and for which the World Bank has blacklisted six Chinese companies currently operating in Nigeria over alleged fraudulent corrupt practices, including deceptive tactics, illicit trade, extortion, Greek gifts and neo-colonial proclivities.

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Afterwards, the House resolved that: “In the light of the COVID-19 which started in China, the House committees on treaties, protocols and agreements, finance as well as debt management is mandated to liaise with the ministry of finance and the Debt Management Office (DMO) to seek review or outright cancellation of latest China loans to Nigeria on the principle of force majeur.

“Henceforth, loans should be in tandem with statutory obligations as prescribed by the Fiscal Responsibility Act.”

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Meanwhile, President Muhammadu Buhari has urged international financial institutions to assist member states, including Nigeria in cushioning the negative impact of the COVID-19 pandemic through various initiatives.

The president listed the support initiatives, which includes extending concessional loans, technical support, lowering of tariff on medical equipment and consumables, sharing of expertise in case management, adopting open trade policies, as well as outright debt cancellation.

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President Buhari made the comment on Monday, May 4 in Abuja while participating in a virtual summit of Heads of State and Government of the Non-Aligned Movement.

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