Allegation of diverted $1bn China loan, has no substance – Okonjo-Iweala


images (15)Following allegations that a substantial part of the loan of $1billion from the Chinese Exim Bank, meant for the construction of a standard gauge rail line linking Lagos and Kano States was diverted under the watch of former Minister of Finance, Dr. Ngozi Okonjo-Iweala, the former minister on Sunday, described the allegations as untrue.
Okonjo-Iweala and Buhari
Okonjo-Iweala and Buhari
In a statement posted on her facebook page and signed by her Media Adviser, Paul Nwabuikwu, the ex-minister stated that the Kano-Lagos rail project was not funded by the China-EximBank, pointing that the China-EximBank keeps and disburses funds for approved projects to contractors based on milestones.
Okonjo-Iweala, who argued that the said funds were not domiciled with the Finance Ministry under her watch, described the allegation as yet another example of the kind of whispering campaign of calumny, innuendo, misinformation, and outright distortions being perpetrated by certain political elements against her in a bid to damage her reputation.
Recall that last Monday, President Muhammadu Buhari had asked the Ministry of Finance to provide explanations on the whereabouts of the foreign loans obtained for rail projects but diverted to other purposes under Okonjo-Iweala’s watch.
The President’s directive followed a revelation made by the Permanent Secretary, Ministry of Transport, Alhaji Mohammed Bashar, who informed the President during a presentation of his ministry’s activities at the presidential villa, that only $400 million is left of the loan.
Bashar had also briefed the President on some challenges facing the transport and maritime sectors such as encroachment on railway land, lack of security on inland waterways and some vague agreements between the Nigeria Ports Authority and ports concessionaires.
Reacting, Buhari had said that it was disappointing to find that foreign loans obtained in line with signed agreements were moved from one project to another.
“I hope that due process was followed before such diversions were carried out. Taking money from one project to another has to be one properly,” he warned.
The President regretted that government had, over the years, failed to meet its counterpart funding obligation on some projects, leading to such projects being left uncompleted or abandoned, adding that there was a clear need to streamline, harmonize, and prioritize on-going projects in the transportation sector.
Meanwhile, in her reaction, Okonjo-Iweala said: “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. This is 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.
“We are confident that those behind this campaign will continue to fail. We respectfully request the media to refrain from attaching Dr. Okonjo Iweala’s name and photographs to spurious and unfounded allegations. Dr. Okonjo-Iweala as a Nigerian citizen in a democracy, a citizen who has served her country with honesty and integrity, also has some fundamental rights to justice and fair play,” she said.

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Hamilton Nwosa is an experienced, and committed communication, business, administrative, data and research specialist . His deep knowledge of the intersection between communication, business, data, and journalism are quite profound. His passion for professional excellence remains the guiding principle of his work, and in the course of his career spanning sectors such as administration, tourism, business management, communication and journalism, Hamilton has won key awards. He is a delightful writer, researcher and data analyst. He loves team-work, problem-solving, organizational management, communication strategy, and enjoys travelling. He can be reached at: [email protected]


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