Former Finance Minister Says Loan Assessed From China’s Exim Bank For Rail Project Is Neither Domiciled At The Ministry Nor Diverted
Immediate past Finance Minister, Dr. Ngozi Okonjo- Iweala has put a lie to allegation that a $1billion loan sourced from China for the execution of rail projects was diverted to other projects by the past administration.
Faulting the allegation, Dr. Okonjo-Iweala, in a statement signed by her media aide, Paul Nwabuikwu, said the Kano-Lagos rail project is not captured in the list of projects funded by China’s Exim bank.
According to the former Coordinating Minister of the Economy, the China Exim Bank keeps and disburses funds, for approved projects,to contractors based on milestones. She said it was not true that the loan was domiciled with Finance Ministry.
President Buhari had recently raised questions over information that a portion of the loan was diverted to other projects, after he was briefed on same by the Permanent Secretary in the Ministry, Alhaji Mohammed Bashar.
She however disclosed that loans sources from the Chinese bank were meant to be used as follows: “$500m for the expansion of four International Airport Terminals in Lagos, Kano, Abuja and Port Harcourt; $500m for the Abuja Light Rail project; $984m for the Zungeru Hydroelectric power project and $100m for the Galaxy Backbone project”.
The statement reads: “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 cross-check 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. “In fact, it was the Lagos–Ibadan rail project, not Lagos-Kano rail project that was proposed in the original application to the China-EximBank. But 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-EximBank: $500m for the expansion of four International Airport Terminals in Lagos, Kano, Abuja and Port Harcourt; $500m for the Abuja Light Rail project; $984m for the Zungeru Hydro-electric power project; $100m 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”, she stated.
The former minister also said she was not surprised at the allegation as it represents “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”, adding that “we are confident that those behind this campaign will continue to fail”.
-Pascal Emeka, Abuja