OrderPaperToday– The Senate has considered and passed President Muhammadu Buhari’s $22.71billion ($22,798,446,773) loan request.
The loan is an outstanding balance of the federal government’s 2016-2018 external borrowing plan.
President Buhari on November 28, 2019 sent a request to Ahmad Lawan-led Senate seeking for approval for the balance of the borrowing plan which the 8th Senate had declined.
Before the consideration of the report, Senator Adamu Aliero (APC, Kebbi) noted that the lawmakers were yet to review the document, hence should be given more time.
The Senate president, Ahmad Lawan, however, expressed fear that the details of the document might be leaked to the press and might sway the perception of loan consideration.
The chamber thereafter resolved to continue with the consideration.
Presenting the report, the vice chairman of the committee, Clifford Ordia, recommended the approval of the loan as it “meets sustainable limit of the country’s debt profile”.
The minority leader of the Senate, Enyinnaya Abaribe, however, warned against considering all the recommendations by the committee in whole but instead, should be done “item by item”.
Eyinnaya accused Lawan of denying him his privilege and surpressing the minority by not allowing him to express himself.
Lawan in response, appealed to his colleague that the matter should not degenerate into partisanship.
Meanwhile, the Senate leader, Abdullahi Yahaya, in his submission, expressed support for the loan which he described as a “good investment” and noted that “there is no economy that debt is not used for growth.”
Senator Gabriel Suswam then advised that the chamber should discuss behind closed doors to be properly guided as there are matters on the power sector he would like to discuss.
The motion was moved by Sen Yahaya who said the session will last for 15 minutes. It approved and started at 12:40pm.
Recall that of the 39 projects the president sought approval of the 8th Assembly for, only the federal government’s emergency projects for the North East’s four states and one China Nexim assistant railway modernisation projects for Lagos-lbadan segment were approved by the 8th assembly of about $6 billion.
The minister of Finance, Zainab Ahmed, who had earlier appeared before the committee on Local and Foreign debts on February 4 said the loan is concessionary and semi-concessionary.
She also informed that it is an average interest rate of 2% per annum with a long tenure with period ranging from 18 to 30 years to be used for infrastructural development which represents 81% of the total loan of $22.718 bn as well as socio-economic projects which are on health care, education and economic governance reforms.
It is worthy to note that 70 percent of the loan, which is about $17bn, would come from the China-Exim Bank while others would be sourced from other lending institutions such as the Islamic Development Bank.
The projects to be executed by the loan are: rehabilitation of the North East, the Mambila Hydro Power project ($4.9 billion), Lagos/Kano modernisation project $4.1 billion), development finance project loan being provided by a consortium of World Bank and AfDB ($1.28 billion).
Development finance project loan provided by the consortium of World Bank, African Development Bank, agencies like AFD as well as KAWF by the development bank of Germany has a total sum of $1.28 million.
The facility is to support a section of the development bank of Nigeria through the development finance institutions in the country, lend to Micro, small and Medium Enterprises through microfinance banks.
Senator Adamu Aliero (APC, Kebbi) queried the construction of road from Lagos to Abidjan, a project included in the loan. He also raised issue of lopsidedness of the projects.
He said: “Is Nigeria borrowing this money to construct these roads from Lagos to Abidjan? Are we so generous to consider this up to Abidjan? Secondly, the East-West road is a very good project and I support fully the inclusion of this project in the borrowing plan. If you look at other parts of the country, nothing is said about the North East. The application of this loan is lopsided and I want to say that other geo-political zones should also be considered.
“We have dilapidated roads all over the country. I don’t see why huge amount of money like this will be concentrated in only one section of the country. When we come to the clause, we should include critical parts that should be covered on this loan.”
Responding Lawan said the executive will be notified.
He said: “We are not doing second reading on this. We have recommendations which we will vote on but before we reach that stage, what is here is what is to finance our capital budget and therefore it is important we are conscious that we need the capital aspect of the budget funding.
“If we notice any lopsidedness, I think it may not be for this senate to just include the projects but it is important that the executive takes note of these areas that were left out and in the next phase we consider those areas that are left out.”
Senator Albert Bassey (PDP, Akwa-Ibom) raised an observation that over 70 percent of the loan is funded by China, currently battling COVID-19.
He said: “If we go by just the recommendations, we might not be properly guided because if you look at the context, we must also approve and ensure that whatever we approve will be implemented. If you look at f from recommendation 1, it is N17billion from China Exim. Is it possible with the Corona Virus?”
Lawan said the approval will be made looking at the “positive side.”
Opposition and accusation
Leading the opposition against the loan is the Minority Leader, Enyinnaya Abaribe who disagreed with the recommendations of the committee.
He said: “Mr. President, I disagree with you on one aspect saying that this is part of the capital part of our budget, presupposes that this had come to us and we had approved it and then it was put in the budget for us to use.
“That is not the position. The position is that we would now approve some of this. It is when we get to the point of looking at each one of them that we will now determine which of these projects will help in growing our economy. Now that you have said we will take it line by line.”
Lawan replying urged that the request is to fund the country’s capital budget.
He said: “It means the capital budget is weighty. Until we pass, there will be no implementation of the capital budget so it is a choice. If we want, we pass, if don’t want, we don’t pass. We are going to make it tight spending this money.
Reacting, Abaribe warned against the passage saying, “I just want to end with a very apt saying which I think the whole world knows, ‘who goes aborrowing, goes asorrowing’.”
As the President of the red chamber continued with the session, the minority leader again moved to stop the process through a point of order but it was not recognized because he failed to brief Lawan, as required by the standing rules of the chamber.
Abaribe then came under rule 14 a of the
Legislative Houses, Powers and Privileges act which allows rights to be enjoyed by the senate collectively and by members of the senate individually.
He then said: “We are going to pass a loan approval of $22.7bn and we, who are going to pay back that are making efforts to make sure this is clarified and Mr. President, you are not giving us the privilege to make our points known and come across. We don’t see anything that is so difficult for us.
Lawan in defense said, he gave Abaribe several chances to speak.
He said: “Havent I given you the chance now? You raised a point of order 43, you didn’t tell me what you are going to raise, I denied you and that is what the standing order says. You are supposed to tell me details, you didn’t even tell me a synopsis. Before then you spoke even more than once. Minority leader you know the process, more than everyone here. You have not been denied your privilege. The minority has had more than a fair share in this respect.”
Abaribe however accused Lawan not allowing Senators to make contributions.
He said: “You are putting us in a very impossible situation because you are telling us to pass even those things that you don’t approve of. This is also about Nigeria. This is not about partisanship. Actually if we are going to talk about partisanship, some of us have complained that this is lopsided and we didn’t want to make an issue of it. I want us to ask if we take this issue item by item because we cannot just wholesomely pass everything that comes if we have to do that, we don’t need to sit here and debate anything.
Lawan replied saying, “There is nothing like trying to separate something. I don’t even believe in that to accuse me of separating the minority. You are behaving like the majority, everyone is just listening to you.”
Senator Gabriel Suswam (PDP, Benue) then advised that the chamber go into executive session because he has certain information that will guide the house properly as it relates to the power sector.
The Senate leader thereafter moved the motion and the chamber went behind closed doors.
The session lasted for 15 minutes.
Resuming from the session, the red chamber approved the request.
Lawan: Senate will ensure strict oversight
Lawan in his concluding remarks said: “The Senate will monitor strictly how these funds are applied by the executive arm of government funding the projects.
Our committees must be prepared to ensure that no single dollar or cent is spent on any other thing outside of what has been indicated here.
We pray that this loan will turn around the economy of Nigeria. It is our belief that this loan will definitely have some positive influence on the GDP of this country.
Therefore, we want to assure Nigerians that as a chamber of the National Assembly, we will be responsible.
We will always be available to ensure that no funds here are utilized for something else or used in very uneconomic and un-prudent manner.
This is our responsibility and we must ensure that we do that.
With this let me thank all of us. It has been a very engaging parliamentary debate on the loan and this is reflective of what Nigerians feel.
There are many Nigerians outside there who feel that Nigeria shouldn’t take the loan.
But there are also many many Nigerians who feel Nigeria should take the loan on the condition that the government applies the loan strictly to the projects it has indicated. And that is where we also stand.