$22. 7BN LOAN: Reps will redress injustice to Igbo – Vanguard

Igbo-chiefsBy Henry Umoru, Assistant Political Editor

THE Senate, on Thursday, under a tense atmosphere, approved the 2016-2018 External Borrowing Plan to the tune of $22.7 billion as requested by President Muhammadu Buhari to be spent by the Federal Government on key infrastructural projects.

Prior to the approval, it was very clear that some senators, especially those in the Peoples Democratic Party, PDP, were not comfortable with the approval as exemplified by the Minority Leader, Senator Enyinnaya Abaribe, PDP, Abia South, who vehemently kicked against the process and procedures the President of the Senate, Senator Ahmed Lawan, wanted the lawmakers to follow.

The issue was that while Lawan preferred that the matter be treated by voting according to the recommendation of Senator Clifford Ordia (PDP, Edo Central) Committee on Local and Foreign Debts, many senators wanted all issues raised in the loan request considered and debated in detail to allow Nigerians know why the loan must be approved.

Abaribe made frantic efforts to ensure that the Senate considered the report part-by-part and sector-by-sector to ensure that lawmakers had a clear understanding of the loan and how relevant it is to the boosting of the nations economy, but, at the end of the day, Lawan held fast to the saying that the majority has its way and the minority has its say.

Consequently, the Senate ignored all requests to allow for debate on the details of the loan and approved the document amid protest.

Though the request for the loan has been granted by the Upper Chamber, furore continues to trail the process, especially from people from the South-East who are kicking against what they called the total exclusion of the zone from a loan that will take care of Federal Government infrastructure.

Recall that Buhari had, on November 28, 2019, written to the Senate, requesting for the approval of 2016-2018 External Borrowing to the tune of $22.7 billion to be spent on key infrastructural projects across the country.

The letter was read on the floor of the Red Chamber by the President of the Senate during plenary.

Projects

In the letter, President Buhari had explained that it became imperative to re-present the request because the Eighth National Assembly approved only a part of the External Borrowing request forwarded to it in September 2016.

According to him, the loan will help Nigeria finance the capital components of the 2020 budget with special emphasis on infrastructure, agriculture, health, education, water supply, growth and employment generation, poverty reduction through social safety net programmes, governance and financial management reforms, among others.

Also recall that the 8th Senate under the leadership of Senator Bukola Saraki had, in November 2016, rejected the request when the Presidrnt wrote the Senate, seeking for approval of the loan.

Then-Senate threw out the request on the grounds that the letter that conveyed the message was not accompanied by a borrowing plan.

Ahead of Senates approval, Minister of Finance, Budget and National Planning, Zainab Ahmed, while defending the decision of government to go for such borrowing before the Ordia Committee, said the loan would be spent to execute key infrastructural projects.

According to her, it became imperative to approach the China-Exim Bank for a $17 billion loan request since other lending institutions like the World Bank and the African Development Bank were not forthcoming.

The Finance Minister, who explained that the Eighth Senate had approved about $6bn out of the $29.96bn loan, leaving a balance of $22.8bn, said that the Federal Government and some state governments were jointly requesting the loan from various lending institutions.

Ahmed noted that the bulk of the loan, $17bn, would come from the China-Exim Bank while the rest would be sourced from Islamic Development Bank, among others, adding that the country had no issue with its current debt profile but with dwindling revenue which could not fund the various projects that are expected to have meaningful impact in the lives of Nigerians.

She added, The funds would be channelled to the funding of infrastructure which will enhance the productivity of our economy. Other projects are in the heath care, education. It also included projects for the rehabilitation of the North-East geopolitical zone.

Others are the Mambila Hydro Power project ($4.9bn), Lagos-Kano modernisation project $4.1bn), Development Finance project loan being provided by a consortium of World Bank and African Development Bank agencies ($1.28bn).

The facilities will support the setting up of the Development Bank of Nigeria through some development finance institutions in Nigeria to provide funds for small and medium size enterprises. This will make access to finance to SMEs easier, help them to grow and help more Nigerians to come out of poverty line.

Above all, the loan would help us to improve our electricity supply, reduce poverty, create jobs, ensure access to finance, agricultural productivity, guarantee food security, achieve high school enrolment, provision of clean potable water, rehabilitation of major roads and development of the mining industry.

On the debt profile of the country, the Minister explained, The 2016 2018 external borrowing plan is both for the Federal Government and the states. So, some states would be responsible for the payment of part of the loan.

On the sustainability of the nations debt portfolio, she said, Nigerias current portfolio ceiling as set by the fiscal Responsibility Act is 25 per cent of total debt to GDP.

The radio for December 2018 is 19.09 per cent but it reduced to 18.9 per cent by the middle of 2019.

The debt service to revenue ratio is however high and it provides us strong justification for us to drive our revenue. For 2017, the ratio was 5 7 per cent and 51 per cent in 2018.

Our debt level is low compared to other countries. For instance, the US, United Kingdom and Canada have debt rate to GDP ratio of 105 per cent while their debt to revenue service is 12.5 per cent.

Protest

On Thursday, the Senate, amidst confusion and protest, went ahead and approved the loan.

The approval was sequel to the consideration of the report of the Committee on Local and Foreign Debts as presented by Ordia.

In approving the loan, the Senate resolved that the agreement containing the whole terms and conditions of the loan from the funding agencies must be forwarded to the National Assembly prior to the execution of same for concurrence and proper documentation.

According to the approved loan, the South-West got $200,000,000 while the South-South, excluding Edo State, got $4,270,000,000.

North-West, which is Buharis geo- political zone, got $6,372,000,000 just as the North-East got $300,000,000 while the North-Central got $6,531,000,000 and $5,853,900,000.00 was reserved for general expenses.

According to the breakdown, the power transmission project in Lagos and Ogun states was allotted $200 million and $800 million was voted for the East-West Road in the Niger Delta.

The Coastal railway project (Calabar-Port Harcourt-Onne deep sea port segment got $3.47billion (Cross River and Rivers states.)

Projects covered in the North-East are the multi-sectoral crises recovery programme ($200m), North-East Nigeria integrated social protection, basic health, education, nutrition services and livelihood restoration project ($100m); and the Lake Chad Basin Commission ($13m, multinational).

In the North-West, the following projects are captured under the loan: Kano-Lagos railway modernisation project (Kano-Ibadan segment double track, $5.53billion; and vocational training in power sector ($50m: FCT, Lagos, Ogun, Kano, Plateau, Niger, Enugu, Kaduna and Cross River).

Others are Kaduna State economic transformation programme for results ($35m, Kaduna); National Information and Communication Technology Infrastructural Backbone Project (NICTIB) phase II ($328.1m (Lagos, Abuja, Ibadan, Akure, Maiduguri, Lokoja, Kaduna, Akwanga, Bauchi, Kano, Katsina); Health System Project ($110m, Katsina); Rural water supply and sanitation ($150m; North-East, and Plateau); and development of the mining industry ($150m, nationwide).

In the North-Central, the projects covered are staple crops processing zone support project ($100m, Kogi); Greater Abuja water supply project ($381m, FCT); Abuja mass rail transit project (phase 2) ($1.25b, FCT); Mambila hydro-electric power project ($4.8b; and Taraba integrated programme for development and adaption to climate change in the Niger Basin ($6m).

According to a source, only 60 per cent of the loan would be available for spending as 40 per cent is to be paid to those that offered consultancy services.

In the approved loan, the entire South-East geopolitical zone (with 15 of the Senate 109 senators) as well as Edo, the home state of the Chairman of the Local and Foreign Debts Committee, Ordia, did not benefit.

Against this backdrop, barely nine days after the Senate approved the 2016- 2018 External Borrowing Plan, the South-East National Assembly Caucus, on Thursday, kicked against the action.

The Caucus, comprising the Senate and House of Representatives members, who met separately with the President of the Senate, Lawan, and Speaker, House of Representatives, Femi Gbajabiamila, took a swipe at the exclusion of the South-East from the loan and described it as humiliating and totally unacceptable.

Speaking on the outcome of the meeting, the Chairman of the Caucus and former Deputy Senate President, Senator Ike Ekweremadu, said the injustice must be addressed in all its ramifications, saying the lawmakers had been assured by Lawan and Gbajabiamila that the matter would be resolved.

Ekweremadu, flanked by the Senate Minority leader, Senator Enyinnaya Abaribe; Deputy Minority Leader, House of Representatives, Hon. Toby Okechukwu; Deputy Whip, House of Representatives, Hon. Nkiru Onyejeocha; and Senator Rochas Okorocha, among other senators and House members, said, You recall that in the last National Assembly, there was a borrowing plan presented by the Federal Government. But for some obvious reasons, especially exclusion, it was not taken.

This has been returned in the present National Assembly. Regrettably, the Senate passed the borrowing plan last Thursday, which excluded the whole of the South-East.

I would like to use this opportunity to thank some of our colleagues who were in the chamber that day, especially Senator Enyinnaya Abaribe, who made spirited efforts to get the issue of equitable distribution addressed.

Most of us were not in the chamber that day. Like myself, I was attending the INEC retreat on electoral reforms in Lagos as a member of the Senate Committee on INEC.

We met as a Caucus last night after consulting with our people and getting their feelings on this issue. We decided that the best approach will be a constructive engagement with the National Assembly leadership.

So, this afternoon (Thursday), we had a very good conversation with both the Senate President and the Speaker of the House of Representatives. They showed not just concern, but commitment to addressing these issues. And we are satisfied with those assurances. And we believe that the matter will either be revisited or, since it has not been passed in the House, the appropriate thing will be done so that our peoples fears could be assuaged.

We want to thank the Senate President and the Speaker for their assurances and their commitments to national unity and justice for all parts of Nigeria. We believe that equity should be the way for our country to make progress.

Opportunity

Speaking further, the former Deputy Senate President said, It is our thinking that since what the FG presented is a borrowing plan, there is still an opportunity for us to look at the distribution so that every part of the country will have a sense of belonging in the way the loan facilities will be managed.

We believe ultimately that every part of Nigeria will be part of the repayment. And if we are going to be part and parcel of the loan repayment, it makes every sense that we all also benefit from the utilisation of those funds.

We are concerned about certain facilities, including the Eastern Railway Corridor from Port Harcourt to Maiduguri, access to the sea through dredging and developing of seaports in our area, power projects etc.

The other issues we raised with them is the issue of the distribution of the National Assembly bureaucracy.

If you look at the distribution, the South-East is excluded from the Clerk to the National Assembly to the Deputy Clerk, the Clerk of the Senate, Clerk of the House, Director-General of the National Institute for Legislative Studies (NILS), Chairman and the Secretary of the National Assembly Service Commission, and the same thing with the Public Complaint Commission.

Again, they showed concern and promised to address this once any vacancy occurs.

When asked on the assurances from the National Assembly Presiding Officers at the meeting, especially on whether they will now include some projects in the South-East as components of that loan, Ekweremadu said, Recall I said that it has not been passed by the House of Representatives. Secondly, I said that this is a borrowing plan.

It is not as if any money has been borrowed and, under the Fiscal Responsibility Act, you are required to get the approval of the National Assembly for you to borrow money.

So, that is tabled before the peoples parliament where every part of Nigeria is represented to have a conversation on it and ensure that it is evenly spread.

That is actually one of the major philosophies behind sending it to the National Assembly. And that is why we are using every legislative avenue to ensure that the proper thing is done.

Meanwhile, recall that the South-East has only 15 senators. It is part of the issue of marginalization we have been talking about and that is why we have been pushing for restructuring.

Even if you put all the 15 members of the Senate from the South East together at a sitting and you vote, definitely, you know what will be the outcome.

So it is not a matter of playing to the gallery. We are here to engage our colleagues in a way that they would understand our concerns and we will get results. That is what matters. Minority will have their say, but majority will have their way.

On the question of if the House of Representatives will find a way to include the South-East, he added, said, There is what we call harmonisation. The idea is that if we are able to get our colleagues and leadership of the Senate and the House to agree on accommodating the South-East and the House does that, then they will bring it back to the Senate for harmonization, which, again, will still passed in the House and the Senate. So, we are still on course.

Vanguard

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$22. 7BN LOAN: Reps will redress injustice to Igbo - Vanguard