As Senate drills Amaechi, Adeosun, others over $5.5bn loan request
From Fred Itua, Abuja
The Federal Government, yesterday, disclosed that it would require a total of $36 billion to complete its ongoing rail projects across various parts of the country.
The revelation which was made by the Minister of Transportation, Chibuike Amaechi, before the Senate committee on Local and Foreign Debts, came just as lawmakers subjected him and the Minister of Finance, Mrs Kemi Adeosun, to intense questioning over government’s bid to borrow another $5.5 billion.
According to Amaechi, “If you put it all together, the total cost of the entire rail projects will amount to about $36billion. Actually we don’t have the money. But it’s an ambitious plan. We really have to start something somewhere and see how far we go.”
Amaechi disclosed that President Buhari had directed that the rail line project be extended to cover all 36 state capitals. He informed the Shehu Sani-led committee on Local and Foreign Debts that part of the $5.5 billion loan being sought was to fund the Itakpe to Warri, Kano to Kaduna and Port Harcourt to Calabar sections of the rail projects.
Buhari had in a letter to the Senate, requesting approval for the loan stated that the projects for which the $2.5 billion part of the $5.5 billion was being sought, was to fund the Mambilla Hydropower Project, construct a second runway at the Nnamdi Azikiwe International Airport, counterpart funding for rail projects and fund the construction of the Bode-Bonny Road, with a bridge across the Opobo Channel.
The Senate committee had raised queries regarding the impact of the planned borrowing of $5.5 billion on the living standards of Nigerians.
“Some of the questions Nigerians and indeed our constituents have asked repeatedly include: what has the Federal Government done with the reported recovered loot allegedly traced to the previous administration? what role can such recovered monies play in the 2017 budget financing? How much indeed has been recovered? Has the National Assembly appropriated the recovered loot for government expenditure? Sani asked.” He said that all actions and decisions with respect to these loan requests by his Committee and indeed this Senate will be done responsibly, only and only, on their merits.
“l will advise therefore, that as representatives of Mr. President, you put your best foot forward and be as convincing as possible with facts and figures. for the Senate to fully have your backing with respect to these requests.
“It has become clear that if Nigeria must borrow, we must borrow responsibly, we cannot afford to mortgage the future of our unborn generation; if we must bequeath to the future generation a pile debt, it must be justified with commensurate infrastructural proof of the value of the debt.
“The payment plan of this debt will undoubtedly last the length of our lifetimes and possubly beyond. We must live behind a legacy that will appease and answer the questions the next generation of Nigerians will ask.
“We must not allow our children and grand children be enslaved with chains of debts. Eurobond must not be another bondage to Europe,” he stated.
Adeosun who was represented by the Director-General of the Debt Management Office (DMO), Patience Oniha, told the committee that the $2.5 billion part of the loan has already been approved in the 2017 budget.
She further explained that the $3 billion part is to off local debts, adding that it is not healthy to have such huge local debt hanging on the head of the nation.
“Borrowing at 7 per cent interest rate in the international market is cheaper than borrowing at 17 per cent interest rate in the local market,” Adeosun noted.
Wondering why the Federal Government could not resort to local resources in servicing the domestic loans, the commitee declared that it is important Nigerians are told how the projects the loans were to be used for would help in servicing and paying the debts.
Responding to questions on the Abuja airport project, Minister of State for Aviation, Hadi Serika, said he did not know the cost of the second Abuja runway which part of the $2.5 billion was to be spent for. He said that the cost has not been determined.