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S/East loses out if NASS approves Buhari’s $6.4 billion China, W/Bank loans
Analysts have started giving analogy of how the South Eastern states will become worst losers by joining in paying for a loan that did not add any value to their lives if the presidency finally secures National Assembly approval to take about $6.4 billion dollar loans from the World Bank and China to fund railway infrastructure.
This is so because all the railway projects that will be funded by the loan are far from the zone, but the repayment will come from federal allocation basket which is meant for all sates.
Observers say if deductions are made for the repayment of the loan, it will affect monthly sharing of allocation as all the states including the South East which did not gain from the loan will join in paying back the loan even though it did not gain from it.
Business Hilights recalls that all the railways meant for the loan has no link with the South East who had made several appeals to the government to join the Onitsha-Aba railway in the emerging new railway revolution sweeping in the north, south west and south south regions of the country.
Part of the loan will go for the Lagos-Calabar coastal rail line, the Kano-Kaduna rail line, and the Lagos-Ibadan rail line and nothing for the south east.
Details of the loan showed that whereas about $5.851 billion which is more than 90 per cent will go for the listed railway development, the difference of $549 million will be used for health matters.
President Buhari is asking the lawmakers for quick approval to enable Nigeria access the China-Africa fund package already included in 2016-2018 external borrowing plan which was forwarded to the National Assembly last August. The Senate had rejected the borrowing plan entirely in November last year.
The President’s letter reads: “I wish to refer to my earlier letter with respect to the above subject and to inform the distinguished senate that the China Exim bank has approved our request for a loan to execute the Lagos-Kano railway modernisation project, Lagos-Ibadan segment for a sum of $1.231 billion.
“The China government has also informed us that the approval of the Lagos-Kano railway modernisation project, Kano-Kaduna segment and coastal railway project, the Lagos-Calabar segment are imminent.
“China Exim supported projects; Lagos-Kano modernisation projects, Lagos-Ibadan segment $1.231 billion; Lagos-Kano railway modernisation project, Kano-Kaduna segment $1.146 billion and coastal railway project, the Lagos-Calabar segment 3.474 billion, making a total of 5.851 billion.
“As you are aware the funds available under the China-African fund are limited and loan applications from all over Africa countries are funded based on first come, first serve and therefore there is an urgent need to sign these loans as soon as they are approved or we may lose out in the event that we delayed in signing the loan agreement.
“These loans form part of the overall money for the rail strategy. We are in the process of completing the concession of the Port Harcourt Maiduguri line to immediately link the eastern part of the nation.
“We fully intend to source further concessioning funding to ultimately upgrade this critical line to high speed standard gauge. These projects form the overall plan to resuscitate the rail transport across the nation and thereby drive inclusive growth.”