FG pays $461m out of $3.313bn loans from China loans – DMO

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A document posted on the website of the Debt Management Office (DMO) shows that Nigeria has paid $461.89 million (about 13.4 per cent) of the $3.313 billion loans obtained from China, leaving a balance of $3.12billion (about 94 per cent).

The document revealed that $192.21 million was paid as part of the principal while $269.68 was paid as interest.

According to the document, the Chinese loans which are tied to a number of projects such as rail, road, communication, power and agriculture, each has a tenor of 20 years, attracts 2.5 per cent interest and a moratorium of seven years.

According to the DMO, as of March 2020, the agreement for the oldest of the Chinese loans was signed on December 20, 2010, while the newest was signed on May 29, 2018. Repayment for the current loans will continue until 2038.

For the Nigerian National Public Security Communication System project, Nigeria signed a loan deal of $399.5million with China on December 20, 2010. Nigeria has received 100 per cent of the loan sum and has paid $76.83 million as principal and $84.92million as interest, totalling $161.75 million. The outstanding against the country currently is $322.67 million.

Nigeria and China signed a loan deal of $500 million for the Nigerian Railway Modernisation Project (Idu- Kaduna section) on December 20, 2010.

Hundred per cent of the loan sum has been disbursed to Nigeria where Nigeria has paid back $96.15 million as principal and $74.52million on interest.

Total payment by Nigeria is $170.67million, while the outstanding is $403.85million.

On November 7, 2012, Nigeria entered into a loan deal with China for the sum of $500million to finance the Abuja Light Rail project.

Over the years, Nigeria has paid $19.23 million out of the principal and $60.63 million as interest, totalling $79.86 million with outstanding at $480.77 million.

To finance the Nigerian ICT Infrastructure Backbone Project, Nigeria signed a $100 million loan deal with China on January 5, 2013.

Although the country has not paid any part of the principal, it has paid $9.38 million as interest.

A $500 million loan agreement was entered into by Nigeria and China for the Nigerian Four Airport Terminal Expansion Project (Abuja, Kano, Lagos and Port Harcourt) on July 10, 2013.

The sum of $455.28 million representing 91.06 per cent of the total sum has been disbursed by China.

Nigeria has not paid back any part of the principal but has paid $40.58 million as interest.

The outstanding against the country is $455.28million.

For the Nigerian Zungeru Hydroelectric Power Project, Nigeria signed a loan deal of $984.32 million with China on September 28, 2013.

China has released only $518.24 million, representing 52.65 per cent of the total sum.

Although Nigeria has not paid any part of the principal, it has paid $19.28 million as interest, while the outstanding is $518.24million.

Nigeria and China signed a loan deal of $325.67million on April 26, 2016, to enable Nigeria fund its 40 Parboiled Rice Processing Plants Project.

No part of the money has been released. So, Nigeria has not paid any money on the loan and there is no outstanding against it.

An agreement for a loan deal of $1.267 billion was signed between Nigeria and China on August 18, 2017 to enable Nigeria finance its Railway Modernization Project (Lagos-Ibadan section).

$759.84million, representing 59.96 per cent of the total, has been released.

Nigeria has not paid any part of the principal but has paid $19.11million as interest. 

For the rehabilitation and upgrading of Abuja-Keffi- Makurdi Road project, Nigeria signed a loan deal with China for $460.82 million on August 18, 2017.

The sum of $80.64 million, representing 17.5 per cent, has been disbursed by China.

Although Nigeria has not paid any part of the principal, it has paid $1.84 million as interest.

The loan deals for the supply of rolling stocks and depot equipment for Abuja Light Rail as well the Greater Abuja Water Supply, $157million and $381.09 million respectively, have been signed, but China has not disbursed any part of the loan.

Many Nigerians have expressed concern that with the inclusion of the sovereignty guaranty clause in the agreements, Nigeria might lose some of these projects to China in the event of failure meet the repayment terms.

The House of Representatives recently raised the issue of the existence of a sovereignty guaranty clause in some of the agreements. 

However, the minister of transportation, Mr. Rotimi Amaechi assured that there would be no need for the Chinese authorities to seize the nation’s assets as the country would pay back its debts to China.

“It’s not that Nigeria doesn’t have the capacity to pay back. We’ll payback. At 2.8 per cent, what other countries would give you that loan? 2.8 per cent for 20 years with seven years moratorium, why can’t your payback? The repayment plan is not done by us, it’s done by the Ministry of finance, but they are meeting the requirements,” said Amaechi.

With The Nigerian Tribune report

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