THERE was heated argument at the House of Representatives Hearing Room
028 yesterday between Minister of Transportation Rotimi Amaechi and
House Committee Chairman on Treaties, Particulars and Agreement Ossai
Nicholas Ossai.
It was during the legislative hearing on the
loans agreements signed by the ministry. At issue was an alleged $33
billion loan which Ossai said Nigeria had signed. But the minister
denied any such agreement.
The drama unfolded before Minister of
Works and Housing Babatunde Fashola and the Minister of Federal Capital
Territory (FCT) Muhammed Bello.
Amaechi, who had warned the
committee against scrutinising the Chinese loans, repeated his position
that Nigeria might lose the opportunity of a loan to fund the
Lagos-Calabar coastal rail line and the people of Southsouth will be
denied that project because “of the committee you set up to investigate
the Chinese loans.”
Ossai (PDP Delta), frowned at the
“misconception and misgivings” on the legislative scrutiny of various
agreements signed by government officials.
He said: ”We have
heard some people ask why we are focusing on only Chinese-related loans
and commercial contracts. We will like Nigerians to know that we aren’t
focusing on only Chinese loans. From what we know, Nigeria has over 500
bilateral loan and commercial contracts agreements and investments
treaties with different countries and institutions.
”There is no
way the committee will do a thorough job without segmenting the issues
based on countries, institutions, or MDAs. Thus, it must be clearly
noted that this is not targeted at only China, neither was it designed
to impede the development of the railway sector and other
infrastructures.
“But rather to ensure full disclosure,
transparency, accountability, utmost good faith, and value for money in
both the bilateral loans and commercial contracts agreements entered
into by the Nigerian government.
“The loan agreements we have
seen so far, show that government officials charged with the
responsibility of representing Nigeria were more desperate to just take
the loans at any condition, possibly using non-negotiated loan
agreements templates rather than go through the rigour of diligent
technical review of negotiating specific clauses with clarity and for
national interest.
”For instance, it’s a common practice that
most international loan agreements would adopt ‘Sovereign guarantee’ and
a neutral international arbitration centre as opposed to waiving of our
national sovereignty in an omnibus manner; especially in dealing with
countries like China, known to possess an absolute state status on their
institutions and corporations.
“However, the immunity clauses in
most of these agreements before us are not only ambiguous but very
obscure. And without recourse to the fact that Nigerian government had
issued circular on the subject matter with reference number
SGF/OP/S.3/X/ 1737 dated 11th August, 2014 that provided guideline on
issues of waiver of sovereign immunity clause during loan and commercial
agreements negotiations.
”We expected government officials
negotiating and signing these loans to fully comply with this guideline
and also ensure that the clauses are couched to clearly reflect same”.
Questioning
the rationale behind accepting Hong Kong as arbitration centre for the
Chinese loans secured by Nigeria, he said “arbitration centres for
bilateral loan agreements are known to be generally on neutral grounds
unlike what we have in most of the Nigeria/China agreements where Hong
Kong that is also governed by China laws was designated as the
Arbitration Centre.
“From our experience, the MDAs sign these
commercial agreements in billions of dollars, then go to the President
and Federal Executive Council for approval to execute, including
securing loan facilities through Ministry of Finance and Debt Management
Office (DMO) and then proceed to negotiate the terms of these loans
before coming back to Mr. President who then writes the National
Assembly asking for approval for billions of dollars to do projects
without attaching the negotiated loan and commercial contracts agreement
details.
“This approach is the reason we have government
representatives signing empty pages of loan agreements repayment
schedule and other key documents required for the loan agreements to
become effective. We have commercial contracts signed in US dollars,
while the loan agreements for the execution of the same contracts were
signed in Chinese YUAN currency in Ministry of Communications and
Digital Economy/Galaxy Backbone Limited.
”We have noticed from
documents available to us that commercial contracts signed by federal
ministry of transportation alone is over $33 billion without any
clearcut financing arrangements. Most of these commercial contracts
agreements didn’t also have local content clauses and more witnessed by
none properly designated and authorized officials.
”There are
observable issues relating to procurement process, evidence of 15%
advanced payments, payment of management fees, drawdown process and
remittances and a whole lot of other matters, which we are strongly
poised to ask questions on and hopes to get honest answers that will
fine tune the current process, plan for possible renegotiation of some
these agreements in order serve Nigerians better.
While
dismissing the claim of an existing $33 billion contract signed by the
Ministry, Amaechi demanded evidence of the contract from the Committee.
He said: “Mr. Chairman, if you say that the the ministry has awarded a
contract of $33 billion, we would want to see it because the only
contract Ministry of Transportation has awarded so far is $1.6 billion
for Lagos/Ibadan (rail project).
“The Implication of having a $33
billion contract is that be will have a large number of workers. There
is no $33 billion contract in the Ministry of contract. What we have is
the $1.6 billion contract awarded under President Buhari and $800
million contract awarded under President Goodluck Jonathan. By the time,
the contract signed under President Jonathan had been completed, 80 per
cent and so, we didn’t have to do anything about local content or no
local content.
“The only one we had to deal with the issue of
local content which is the only contract we have for now is the $1.6
billion contract awarded from Lagos to Ibadan of which the Chinese
government is providing $1.2 and wed are providing the remaining $400
million. There are over 20,000 workers on that project with only 560 of
them being Chinese. We need to begin to say truth to Nigerians.”
Amaechi
told the committee that the Lagos/Calabar rail line will not be
possible because the House is probing the loan which has not been
secured for the project, adding that at the moment, there is no contract
because there was no loan.
However, as the interaction began to
degenerate into an altercation between the minister and the Chairman of
the Committee, the Speaker walked in unannounced and asked that the
hearing be adjourned for 10 minutes.
Ossai demanded comprehensive
explanation from the Minister on the various loans taken by the
government insisting that it was immaterial whether the loan was taken
by the APC government or the PDP government, adding that what was
important was that the interest of Nigeria and future generation of
Nigerians was at stake.
The following discussion took place between the minister and the panel chairman:
Ossai:
You submitted an addendum section 16 B (1) under the loan content
obligation. Articule 61 (1) stated that the contractor hall develop and
submit to the employer, Ministry of Transport for its approval a local
content plan for training and engagement of Nigeria labour plan in all
aspect of the contractor work. Can you provide the committee the
certified copies of the labour plan, training carried out and the
beneficiaries and evidence of the number of Nigerians working in all
aspect of this project and their Chinese counterpart as provided in that
document?
Amaechi: I will give a slight response to your speech
and they my response. The slight response is to say that we tried to be
more patriotic than we have been.
Committee member: Point of order Mr. Chairman.
Ossai: I have given him the right to speak.
Amaechi:
No sir, I have a right to speak. You have invited me and I have a right
to speak. I was once a member of a House. So, I have the right to talk.
Ossai: Can you speak to the questions I asked you now?
Amaechi: It is either you allow speak or I stop.
Ossai:
I am in charge here and I will observe you when the need arises. The
Minister is speaking and I will not observe any other member. Let the
Minister finish his speech and I will give you room to talk.
Amaechi:
So, Mr. Chairman, the contract awarded by this government is $1.2
billion contribution by the Chinese and the $400 million being
contributed by Nigeria. You ask for document and I have said I will
provide the details. You talk of training. Over 150 Nigerians are in
China to be trained. Apart from that, they have built two training
institutions. One in Idu and I will like the Chairman to come and visit.
We are also building a university in Daura.
Ossai: Are you aware, Mr Minister of the $11.1 billion Nigeria Coastal Railway project that was signed on 1st of July 2016?
Amaechi: Has the loan been approved?
Ossai: I am asking you. Are you aware?
Amaechi: I am aware, but has the loan been approved?
Ossai:
You made a lot of statements initially and you restricted yourself to
one. The Commercial contract further stated that the contract further
covenant that he shall give priority to the engagement of Nigerian
commercial firm for the supply of goods and materials. Can you provide
us with records of Nigerians commercial firms currently being engaged
and providing services under this contract.
Amaechi: it is
important to tell you that the contract was signed as a credit to a loan
and we have not gotten the loan because of you and the committee you
set up against the China group. That contract is from Lagos to Calabar
which covers the whole of the south south. We may not get that loan and
so, there is no contract.
Ossai: I am talking about the contract…
Amaechi:
Which contract? Do you want to see the south south contract? If you
want to, say so. Because you are from the south south. Because of the
committee you have set up, we will loss that loan for the project from
Lagos to calabar.
Ossai: This issue is not about South south, but
about Nigeria and I am serving Nigeria as a legislator. For us to
continue to serve our geopolitical zones, this country will not be nice.
If zone A get their share, next year, another zone…
Amaechi: I am coming, have you now approached me on south south rail?
Ossai: I have not
Amaechi: You have. Mr Chairman, you have approached me.
Ossai: That is ok. We will degenerate the issue to south south or any other south.
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