By Olu Fasan
There are two ways to conquer and enslave a nation. One is by the sword. The Other is by debt – John Adams, 1829.
THE above quote, attributed to John Adams, the second US President, relates worryingly to Nigeria. For this country was once conquered and enslaved by the sword; now, it’s being conquered and enslaved by debt! In the mid-1800s, George Goldie used Maxim guns to conquer and subjugate the entities that later became Nigeria.
And after its creation in 1914, Nigeria was colonised ‘by the sword’ for nearly 50 years before gaining political independence in 1960. But Nigeria has never been economically free; and now, it’s being conquered and enslaved by debt, as China uses its enormous economic clout to trap the country in unsustainable debt and turn it into one of its client states.
Of course, in the first subjugation, Nigeria had no choice beyond putting up feeble resistance. But in what looks like the second, it’s a willing instrument. Truth is, Nigeria is a willing pawn in China’s debt-trap diplomacy, and has deliberately put itself in China’s economic, political and ideological spheres of influence.
In May last year, President Muhammadu Buhari lavished praise on China. When the chairman of China Railway Construction Corporation, Fenjian Chen, visited him at the State House, President Buhari said:
“We are very grateful to China for the genuine efforts and strides to rebuild our infrastructure.” In July this year, while receiving the outgoing Chinese Ambassador to Nigeria, Zhou Pingjian, Buhari praised China again.
“Please convey our appreciation to President Xi Jinping,” he said, “for the contribution of China towards reversing the infrastructure deficit we suffer in the areas of rail, roads, airports and power.”
But in saying all this, does President Buhari believe that China’s debt-laden “rebuilding” of Nigeria’s infrastructure is based on altruistic motives? Is he not aware that China launched the “Go Out” policy in 1999, underpinned by a global investment and lending programme, to build infrastructure across developing countries to advance its global ambitions, which many have described as imperialist?
Truth is, China’s loans only leave recipient countries with unsustainable debts and, often, economically unviable projects. The real benefits go to China. Why?
Because when China gives loans, it ties them to projects that must be carried out by Chinese companies, with supply and service contracts that go to Chinese firms and labour that is mainly Chinese. Yun Sun, a Chinese academic, said that China’s infrastructure loans are designed to create jobs for Chinese firms and Chinese people abroad.
Essentially, it is Chinese loans for Chinese firms, products, services and workers! In a recent tweet, Dr. Kingsley Moghalu said: “This is a rip-off. This is not loan”, adding: “Nigeria is subsidising China’s export strategy.”
Indeed, talking of exports, Nigeria has made itself a signed-up member of China’s “Go Out” global expansion strategy, of which aggressively promoting its exports is a key part! In 2018, Nigeria signed a three-year Renminbi-Naira Swap Agreement with China, worth 15 billion Chinese Yuan (CNY), equivalent of N720bn or US$2.5bn. Its aim was to enable Nigeria to pay for Chinese imports without the constraints of dollar scarcity.
Of course, the main beneficiary is China. The swap agreement allows China to push its manufactured exports to Nigeria, while buying only commodities from Nigeria. It hardly imports non-oil products, which Nigeria badly needs to export to diversify its revenue base.
Which brings us to the much-criticised lack of transparency of China’s loans. While the terms of IMF, World Bank and other multilateral and bilateral loans are often open for scrutiny, the real terms of Chinese loans are shrouded in secrecy. Sadly, the Buhari government is a willing accomplice in keeping the fine prints of China’s loan agreements secret.
Earlier this week, the House of Representatives queried the transport minister, Rotimi Amaechi, over the terms of a $500m Chinese infrastructure loan to Nigeria. But Amaechi asked the legislators to stop asking questions about the loan. Why? Well, hear him: “If the Chinese government have the feeling that you don’t like the way they lend you money, they may withdraw their loan offers.”
Shocking! Put simply, Amaechi was telling Nigeria’s lawmakers: don’t ask questions about the terms of China’s loans; they don’t like anyone questioning the terms of their loans; you must accept the terms as given!
Joshua Rano, a former TIME magazine editor, once wrote that China’s economic power is serving “like a magnet working on grains of iron to align other nations’ economic interests with the Middle Kingdom’s.”
Well, one country where that magnetic effect is so powerful is Nigeria. The Yuan magnet has really drawn Nigeria into China’s economic orbit, and, of course, into utter indebtedness and economic subjugation!
But the consequences of Nigeria’s entanglement with China are not only economic, they are also political and ideological. I mean, can Nigeria really pursue an independent foreign policy that China disagrees with? Well, the answer, it seems, is no!
In April 2016, President Buhari went to China with six state governors and nine ministers. He returned with an offer of $6bn infrastructure loan. Ten months later, on January 11, 2017, Vanguard reported:
“Nigeria severs diplomatic relations with Taiwan, closes Abuja office.” Earlier that month, Nigeria and China published a joint statement in newspapers, stating: “Nigeria agrees that One China policy is at the core of its strategic partnership with China.”
China had used its economic clout to influence Nigeria’s foreign policy. But how far can that go? For instance, can Nigeria criticise China’s induced national security law and human rights violations in Hong Kong? If the exiled Tibetan leader, Dalai Lama, wants to visit Nigeria and China objects, would Nigeria still grant him a visa?
Truth is, tied to Beijing’s purse strings, Nigeria is joined at the hip with China politically and ideologically. But a debt-dependent strategic relationship with China is enslavement, and not in Nigeria’s best interests!