—-Says loans from China are cheapest
By Johnbosco Agbakwuru
ABUJA – THE Presidency on Monday said that Nigeria will be made a laughing stock by leaders of the neighbouring countries if they should visit the country and discover that power supply was not sustainable.
The Presidency also explained that the interest to be paid for the loans from China was the cheapest in every part of the world and that the loans were for the provision of infrastructure.
Speaking in an interview with the African Independent Television, AIT, the Senior Special Assistant to the President on Media and Publicity Malam Garba Shehu noted that it was said that the country some years back spent $26 billion in power and yet there was darkness everywhere.
Justifying the borrowing from China by the President Muhammadu Buhari’s administration, Shehu said, “We are borrowing for long delayed infrastructure. This country needed to have resolved a number of infrastructural problems much earlier than now.
“Some of our neighbors will laugh at Nigeria when they come and they find that electricity is not sustainable for a long period of time. This is a country we voted $16 billion to supply electricity. That money disappeared into the tin air, no power, nothing to show.
“So if we are borrowing now, government is prudent in management of the fund and borrowing specifically to projects for which there will be results. Look at the Abuja Light Train now, the Africa’s fast modern city rail in the whole continent. We are now borrowing money to put more coaches because there is huge appetite now especially for people in the outer space wishing to shuttle between the city centre and those outlaying areas.
“Look at the thing we are doing with the rail in Lagos and Ibadan, the rail will be completed early in the new year and coaches have to be bought otherwise it will just be sitting there. We are running train between Warri and Ajaokuta, Kaduna and Abuja is running and every day the coaches available now are overstretched.”
On what What Nigeria would give back to China for the loans, Shehu said, “One thing I can assure you is that there are no political strings attached to borrowing by China. This assurance has also been given by the Chinese President when he opened the FOCAC meeting in China last week. Because fears are being expressed.”
Also on the allegation that Nigeria was moving closer to Chinese debt trap, he said that to borrow from China was the cheapest than even from the country that colonized the country.
He said, “Obviously opinions are bound to differ on matters such as this one. We are borrowing from China for critical infrastructure and the last discussion I had on the interest rate, a particular package was being offered at three percent for a 20 year period of repayment and at that time the government was being advised to talk to the Chinese leadership that this interest could still be reduced to one and half percent.
“Now, I think if this is money coming from my mother-in-law, I will say that it is next to a gift. So, I don’t think it is right to say that the Chinese terms are high when you make comparisons with what obtains elsewhere, the Britain, institutions and so on, concessional errors can come from World Bank, it doesn’t come all the time.
“So and then to say whether we are over borrowing from China, the thing is all nations borrow. The US President Donald Trump has imposed sanctions on China and even which China paid back by imposing sections.
“On agriculture in America, President Trump is borrowing $12 billion from China in order to comfort American farmers who are hurt by the sanctions. Therefore, it is norm and it is a global practice.”
On the allegation that the nation’s external debt has been increased with over N10 trillion, in the past three years, he said that every other countries borrow to put infrastructure.
According to him, “My understanding from what we learnt from the experts is obviously all the time, they are looking at the debt GDP ratio and for us in Nigeria, some say 16 percent, some say 20 percent, that is not threatening when you consider some countries it is over 100 percent including Japan and the countries are living with it.
“So the thing there is, what are you borrowing for? Some of the projects for which we borrow money actually when you pay back those loans, money is not been borrowed or to be mismanaged.
“The gains are enormous. There is the political side of this. The continent as a whole, China, Africa resolving to do a lot more consultation to synergies at global platforms, the UN, the World Trade Organisation etc so that they accept that they have common objective to pass through a global platform.
“Outside of this, as a country, yes we have a yearning for infrastructure, there is a huge infrastructure deficit which this administration is bent on bridging. So we went there, we wanted support for cheap projects like the power plant in Mambilla which is the nation’s biggest like 350mw and at the highest level the Chinese leadership said we will support you, we will make you succeed.
“There is a huge gas pipeline which is a signature project by the NNPC bringing gas from Delta through Ajaokuta, Abuja, Kaduna and Kano, about $2.8 billion which the Chinese National Oil Company has also agreed that they will be funding.
“The President of China actually said they are now ready to open Chinese market for Nigeria’s agricultural products. If we you consider what is going on over this period of time we are trying to push into EU market and all of that and all of the challenges that we have. The thing is the way to open up and there will be market for Nigeria. This is complimented by the allowance for the use of naira by Chinese.
“There are so many other packages, about 13 has been signed including an industrial park worth over $2 billion which would see a company growing cotton producing textile garments and projects that will be in Katsina, Abia, Lagos and look at Edo getting so much from the place. So there are so much that have been achieved.”