Okonjo-Iweala: As Buhari, APC Guff Again In China Exim-Bank $1bn Loan Diversion

Okonjo-Iweala

When you have not been in power for 16 years, common sense dictates that you tread softly on certain key economic issues especially those you have no clear information about. In its desperation to prove that it is fighting corruption, the government of the day has been banding figures of alleged missing trillions of naira under previous administration led by Dr Goodluck Jonathan.

While some figures are emanating from the Secretariat of the ruling APC , others are coming from the Presidential Villa, all through press statements and accompanied with all manners of threat of recovering ‘missing fund’. And anyone who calls for caution like Bishop Mathew Kukah did recently is branded a supporter of corruption and endorsing corruptions allegedly perpetrated by the previous administration.

With no ministers in place, the government has been making allegations against the previous government as if it is desperate to demonise and crucify the alleged perpetrators of corruption in that government in public court without waiting for the legal courts.

Recently the Jonathan administration was accused by the government of diverting substantial part of the $1.005 billion loan from the China Exim-Bank obtained for the construction of a standard gauge rail line linking Lagos and Kano.

The media feasted on it, and APC and President Buhari vowed to recover the ‘stolen funds’. Now it has turned out that the money in question was not domiciled with Federal Ministry of Finance but with China-Exim Bank that disburses the money directly to the contractors who are also Chinese. That is why the light rail project from Abuja to Kaduna among others is still going on despite the change of government. Since May 29, many local contractors have vacated most sites because of the likelihood that Buhari may cancel the contracts, but those financed by the Chinese are in progress with funding not being an issue.

The government did not only guff by claiming that over $1billion was diverted, apparently because it is did not take time to read the terms of agreement with the Chinese Bank, it also wrongly identified the rail project in question.

In reacting to the alleged diversion at the weekend through a statement by her Media Adviser, Mr. Paul Nwabuikwu, former minister of Finance Dr Okonjo-Iweala said that the first point to be cleared was that China-Exim Bank did not fund the Kano-Lagos rail project.
She also noted that contrary to the allegations, the Chinese bank keeps and disburses funds for approved projects to contractors based on milestones, as funds are not domiciled with the Finance Ministry.

"Since this story was first reported, we have continued to receive media inquiries regarding an allegation reportedly made by the Permanent Secretary, Ministry of Transport, Alhaji Mohammed Bashar, that a substantial part of a $1bn loan obtained from the China-EximBank by the Jonathan administration for a Kano-Lagos rail project was diverted to other projects.
"I want to state categorically that there is no truth in the reported allegation. Anyone who is interested can crosscheck with the China-EximBank or the Chinese Embassy.

"It is noteworthy that even though President Buhari, in his reported comments on the allegation, made no reference to Dr. Okonjo-Iweala but rightly stressed the need for due process and transparency in the execution of public projects, a sponsored media campaign has once again been launched by political elements to make the former Minister the culprit in a non-existent scandal.

"The alleged diversion has no substance for the simple reason that the Kano-Lagos project was not even among the projects presented for funding by the China Exim Bank for several strategic infrastructural projects across the country," the former minister said.

According to her, it was the Lagos–Ibadan rail project and not the Lagos-Kano rail project that was proposed in the original application to the China-EximBank, adding that in the end, no funds were assigned for the Lagos-Ibadan rail project by the China-EximBank.
"The fact which can be confirmed is that the following projects, which are at various stages of progress are being funded from facilities obtained from the China-Exim-Bank," she said.

The statement listed them as $500 million for the expansion of four international airport terminals in Lagos, Kano, Abuja and Port Harcourt, $500 million for the Abuja Light Rail project, $984 million for the Zungeru Hydro-electric power project, and $100 million for the Galaxy Backbone project.

"It is also important to note that even if the alleged project was on the list of China-EximBank funded projects, diversion of any Chinese funds would have been extremely difficult because the terms of the contract and the processes would simply not have permitted such action.

"The procedure is that funds for approved loans remain in the China-EximBank and are released directly to the Chinese firm executing the contract only after the presentation of duly certified proof of work by the responsible Ministry, in this case it would have been the Federal Ministry of Transport, based on the agreed milestones.
"For the sake of emphasis, the China-EximBank does not disburse money directly to government and therefore the issue of diversion does not arise.

"This is yet another example of the kind of whispering campaign of calumny, innuendo, misinformation, and outright distortions being perpetrated by certain political elements against Dr. Okonjo-Iweala in a bid to try to damage her reputation. We are confident that those behind this campaign will continue to fail.

"We respectfully request the media to refrain from attaching Dr. Okonjo-Iweala's name and photographs to spurious and unfounded allegations. Dr. Okonjo-Iweala as a Nigerian citizen in a democracy, a citizen who has served her country with honesty and integrity, also has some fundamental rights to justice and fair play," the statement added.

It is doubtful if the Buhari administration and the APC will learn from this and do their homework well before rushing to the media to score some cheap political point when the next election is four years away.