The Socio-Economic Rights and Accountability Project (SERAP) has asked the Minister of the Federal Capital Territory (FCT), Nyesom Wike, and the 36 state governors in Nigeria to make public details of any Chinese loans, liabilities, and other external borrowing obtained, and guaranteed by the Federal Government (FG) as well as the terms and conditions for any such borrowing including the provisions on collateral.
The group in a statement issued by its Deputy Director, Kolawole Oluwadare also tasked Wike, and the 36 state governors to make known, details of the repayment obligations regarding any Chinese loans, liabilities, and other external borrowing obtained and guaranteed by the FG, the interest rates on the loans, and any defaults, debt restructuring, and debt exposure to China and other creditors.
SERAP further asked the governors and the FCT Minister to clarify any investment agreements with Chinese companies and repayment histories of any loans, liabilities, and facilities obtained from China and other external creditors and guaranteed by the FG.
Referencing its letter dated August 24, 2024, SERAP stated, “We are concerned that your state and the FCT may have failed to manage your debt obligations efficiently, especially your external debt and investment obligations, as guaranteed by the Federal Government.
“The failure to uphold your obligations is contrary to Section 6 of the Debt Management Office Establishment (Etc), Act, and creates financial risks and other exposure to Nigeria concerning these Chinese loans, liabilities, and other external borrowing.”
According to SERAP, “These Chinese loans, liabilities, and other external borrowing by your state and the FCT may not have been used for the purposes for which they have been obtained and terms and conditions guaranteed by the Federal Government.”
The group, in its letter, insisted that “SERAP is concerned that there is a significant risk of defaults of the Chinese loans, liabilities, and other external borrowing by your state and the FCT, which are guaranteed by the Federal Government.
“There are also significant risks of confiscation of Nigerian assets in foreign jurisdictions by multilateral and bilateral agencies and other creditors in cases of failure by your state and the FCT to satisfactorily observe and fulfil the terms and conditions of the Chinese loans, liabilities, and other external borrowing which are guaranteed by the Federal Government.
“The apparent inadequacy of safeguards and accountability mechanisms for these Chinese loans, liabilities, and other external borrowing may also expose Nigeria’s assets in foreign jurisdictions to confiscation.
“Your state and the FCT have a shared obligation to ensure that the spending and repayment plans of Chinese loans, liabilities, facilities, and other external borrowing are consistent with the provisions of national and international standards, and to prevent or mitigate risks of confiscation of Nigerian assets abroad.
“We would be grateful if the recommended measures are taken within 7 days of the receipt and/or publication of this letter.
“If we have not heard from you by then, SERAP shall consider appropriate legal actions to compel your government and the FCT to comply with our request in the public interest.”