34 months after, Reps rescind resolution on $22.8bn 2016 to 2018 external borrowing plan

The House of Representatives on Tuesday resolved to rescind its earlier resolution on the approved $22,798,446,773 under the 2016–2018 Medium Term External Borrowing plan.

The resolution was passed sequel to the adoption of a motion sponsored by the Chairman, House Committee on Rules and Business, Hon. Abubakar Fulata.

In his lead debate, Hon. Fulata observed that the “2016–2018 Federal Government External Borrowing (Rolling) Plan was approved by the Senate and the House of Representatives on 5 March 2020 and 2 June 2020 respectively.

“Recalls that the National Assembly approved the sum of $22,798,446,773 only under the 2016–2018 Medium Term External Borrowing (Rolling) plan.

“The House is aware of the communications from the Federal Ministry of Finance requesting approval of modifications to the financing proposal for the Nigerian Railway Modernization Project (Kaduna–Kano segment) occasioned by the COVID–19 Pandemic whereof China Exim Bank withdrew its support to finance the project.

“The House is also aware that to secure funds for the project, the Contractor (CCECC Nigeria Limited) in collaboration with the Federal Ministry of Transportation engaged China Development Bank (CDB) as the new financier in the sum of $17,065,496,773 only.

“To this end, the House rescinded its decision on the financier and harmonized terms and approve the change of Financier from China Exim Bank to China Development Bank.”

The House also approved relevant conditions provided on the Kaduna–Zaria–Kano segment for which China Development Bank is the Financier of the Commercial loan.

According to the resolution passed by the House, the Maturity date for the loan is 15 years, payable in Euro, with a 2.7% + 6 months Euribor interest rate; 0.4% Commitment Fee and 5% Upfront Fee to be paid by Nigeria.

In his intervention, Hon. Ossai Nicholas Ossai objected that the specifics of the agreements should have been brought to the floor of the House for scrutiny by members who are representatives of Nigerians and their interests, and so that members can be guided while seeking to approve the loan.

The Speaker, Hon. Femi Gbajabiamila, however, stated that the relevant Committees’ Chairmen including House Committee on Aids and Loans as well as that on land transport should see him in his office.

To this end, the motion was voted on and adopted.

 

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