President Muhammadu Buhari on Thursday resent to the Senate for approval a proposal to borrow $29.96 billion offshore to fund some critical projects – but still did not present a detailed draft plan for that loan request – a major reason the Bukola Saraki-led 8th National Assembly refused to approve it.
The President rather told the lawmakers that the loans would fund 39 emergency projects in the power, agriculture and transport sectors, and asked them to request further details from Zainab Ahmed, minister of finance, budget and national planning.
Apart from majorly addressing the nation’s challenges of infrastructure which the President had informed in the loan request to the 8th National Assembly, the loan was to execute other projects including the Mambila Hydro Electric Power Project, Railway Modernisation Coastal Railway Project (Calabar-Port Harcourt-Onne Deep Sea Port Segment), Abuja Mass Rail Transit Project (Phase 2), Lagos Kano Railway Modernization Project (Lagos-Ibadan Segment Double Track), Lagos Kano Railway Modernization Project (Kano-Kaduna Segment Double Track).
Other areas the loan was targeted to fund were Eurobond, Federal Government Budget Support, Social (Education & Health), Agriculture, and Economic Management & Statistics respectively.
However, in the new loan request Buhari resent to the 9th National Assembly and read by Senate President Ahmad Lawan, he revealed that the 8th National Assembly approved only a part of the External Borrowing request he forwarded to it in September 2016.
According to him, out of a total of thirty-nine (39) projects, only the Federal Government’s Emergency projects for the North East, (Four (4) States’ projects and one (1) China Exim Bank Assisted Railway Modernisation Project for Lagos – Ibadan Segment) were okayed.
This, according to him, stalled the Federal Government’s implementation of critical projects spanning across the mining, power, health, agricultural, water and educational sectors.
But a source in the 8th National Assembly when that request was rejected confided to BusinessDay then, that giving approval to the President’s request without an attached draft plan would amount to giving ‘anticipatory approval’ to the borrowing plan yet to be submitted to the National Assembly.
Buhari said in the resubmitted request: “Pursuant to Section 21 and 27 of the Debt Management Office (Establishment) Act, I hereby request for Resolutions of the Senate to approve the Federal Government’s 2016 – 2018 External Borrowing plan, as well as relevant projects under this plan.
“Specifically, the Senate is invited to note that: While I had transmitted the 2016-2018 External Borrowing Plan to the Eighth National Assembly in September, 2016, this plan was not approved in its entirety by the Legislature, only the Federal Government’s Emergency projects for the North East, (Four (4) States’ projects and one (1) China Exam Bank Assisted Railway Modernisation Projects for Lagos – Ibadan Segment) we’re approved, out of a total of thirty-nine (39) projects.
“The Outstanding projects in the plan that were not approved by the Legislature are, nevertheless, critical to the delivery of the Government’s policies and programmes relating to power, mining, roads, agriculture, health, water and educational sectors.
“These outstanding projects are well advanced in terms of their preparation, consistent with the 2016 Debt Sustainability Analysis undertaken by the Debt Management Office and were approved by the Federal Executive Council in August 2016 under the 2016 – 2018 External Borrowing Plan.
“Accordingly, I have attached, for your kind consideration, relevant information from the Honourable Minister of Finance, Budget and National Planning the specific outstanding projects under the 2016 – 2018 External Borrowing plan for which legislative approval is currently sought.
“I have also directed the Minister to make herself available to provide any additional information or clarification which you may require to facilitate prompt approval of the outstanding projects under this plan,” Buhari stated in the letter.
According to details from the earlier document presented to the 8th NASS, the three-year external borrowing plan seeks concessionary debts and low-cost loans from multilateral agencies including the World Bank and the Chinese EXIM Bank.
The then Minister of Finance Kemi Adeosun said the plan which was supposed to span 2016-2018 seeks to access foreign loans with interest rate of 1.25 percent, offering four to seven years of moratorium and 20 years repayment period.
Other multilateral agencies that will be providing the loans are African Development Bank, and Japanese International Cooperation Agency (JICA). BusinessDay could not independently confirm whether anything has changed despite wide inquiries.
The spokesman of the Senate, Godiya Akwashiki, while fielding questions from journalists after the President’s request was read at plenary on Thursday, confirmed that the borrowing plan was not yet available.
He admitted that “the 8th NASS rejected the request because it didn’t come with the details of what the President wanted to use the money for”.
“The Senate President read another request letter for the borrowing plan. The life of the 8th Assembly has elapsed. The request of the President details would be made known when the request comes from the minister of finance,” he explained.
Also, Ola Awoniyi, Special Media Adviser to the Senate President, told BusinessDay that only the cover letter which was read was available at the time, but he was not sure whether there were attached details. He also confirmed that President Buhari had however asked the Senators to seek further details from the Minister of Finance, Budget and National Planning.
Also in another letter, Buhari has sent to the Senate the Companies and Allies Matters Bill, 2019 for quick consideration and passage.
The letter read: “Pursuant to Section 58 of the Constitution of the Federal Republic of Nigeria 1999 (as amended), I hereby forward the Companies and Allied Matters Bill, 2019 for consideration and passage into law.”
“The Senate may wish to note that, in this Bill, Section 26(5) of the extant Companies and Allied Matters Act has been amended to: Preserve the powers of the Attorney-General of the Federation to approve the registration of Companies Limited by Guarantee: and Reflect the Ease of Doing Business principles in Executive Order No. 1 of 2017 on the Promotion of Transparency and Efficiency in the Business Environment,” it stated.
Onyinye Nwachukwu & Solomon Ayado, Abuja
