News
Failed Abuja CCTV Project: Court Orders FG to Account for $460m Chinese Loan
A Federal High Court in Abuja has ordered the President Muhammadu Buhari’s Administration to “account for the spending of $460 million Chinese loan to fund the failed Abuja Closed-Circuit Television (CCTV) project,” according to the eagleonline report.
The Court also ordered the government to “publish the total amount of money paid to Chinese and local companies and contractors and specific details of the names of the companies and contractors and status of the implementation of the project.”
Justice Emeka Nwite made the orders while delivering judgment in a Freedom of Information suit number: FHC/ABJ/CS/1447/2019 brought by Socio-Economic Rights and Accountability Project (SERAP).
The suit according to Deputy Director, Kokawole Oluwadare followed the disclosure in 2019 by the Minister of Finance, Zainab Ahmed that “Nigeria was servicing the loan”, adding that she had ‘no explanations on the status of the project.’ She reportedly said, “We are servicing the loan. I have no information on the status of the CCTV project.”
In his judgment, Justice Nwite agreed with SERAP that “there is a reasonable cause of action against the government. Accounting for the spending of the $460 million Chinese loan is in the interest of the public. It will be inimical for the court to refuse SERAP’s application for judicial review of the government’s action.”
Justice Nwite also said that, “The Minister of Finance is in charge of the finance of the country and cannot by any stretch of imagination be oblivious of the amount of money paid to the contractors for the Abuja CCTV contract and the money meant for the construction of the headquarters of the Code of Conduct Bureau (CCB).”
The jurist also ordered the government “to provide the details clarifying whether the sum of N1.5 billion Naira paid for the failed contract meant to construct the headquarters of the Code of Conduct Bureau (CCB) was part of another loan obtained from China.”
Justice Nwite’s judgment, read in part: “SERAP’s core objectives are to promote human rights, transparency and accountability and anticorruption in Nigeria.”
“I am of the humble view that there is a reasonable cause of action against the government [through the Minister of Finance] and I so hold that SERAP has made out a case to be entitled to the reliefs sought.”
“The law is well settled that where a document or letter is sent by post, it is the law that same is taken or presumed to have been delivered.”
“Following this principle of law and relying on exhibit OS2, SERAP’s Freedom of Information request sent to Ms Ahmed is deemed to have delivered. Therefore, the averment by the government [through her] that they were not served with the letter is hereby discountenance. I so hold.”
Joined as defendants in the suit are Ms Ahmed and the Minister of Police Affairs.
Justice Nwite granted the following orders of mandamus against the Nigerian government:
AN ORDER OF MANDAMUS is hereby made directing and compelling the government [through the Minister of Finance] to provide and make available to SERAP information on the total amount of money paid to contractors, with specific details of names of companies local contractors involved, from the $460 million loan obtained in 2010 from China by the Federal Government of Nigeria to fund the failed Abuja CCTV contract.
AN ORDER OF MANDAMUS is hereby made directing and compelling the government [through the Minister of Finance] to provide the details of the local companies and Chinese contractors that have received funds from the $460 million loan for the finance of the Abuja CCTV contract as well as details of the status of implementation of the project.
AN ORDER OF MANDAMUS is hereby made directing and compelling the government [through the Minister of Finance] to provide the details clarifying whether the sum of N1.5 billion Naira mobilisation fee reportedly paid to the contractors for the construction of the Headquarters of the Code of Conduct Bureau in Abuja was part of another loan from China. This is the judgment of the court.
Oluwadare said: “The onus is now on President Buhari to immediately comply with the court’s orders. We commend Justice Nwite for his courage and wisdom, and urge President Buhari and Abubakar Malami, Attorney-General of the Federation and Minister of Justice to immediately obey the court orders.”
“This is a victory for justice, rule of law, transparency and accountability. The judgment shows the way forward in the fight against corruption and impunity of perpetrators. We will do everything within the law to ensure full compliance by President Buhari with this ground-breaking judgment on Chinese loans.”
“We call on President Buhari to use the judgment as the basis for publishing details of spending of all Chinese loans and other loans obtained by his government since May 2015.”
Nigeria’s total borrowing from China climbed from $1.39 billion to $4.29 billion between June 2015 and December 2022, according to data from Debt Management Office (DMO).
Nigeria’s 2023-2025 Medium Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP) revealed earlier in the year that the federal government will spend N6.31 trillion on debt servicing in 2023, which amounts to about 74.6% of the government’s projected revenue of 8.46 trillion for the year.
Nigeria risks losing key national assets to China in the event that it defaults in paying back loans obtained from China.
According to a report, Nigeria may have defaulted on Chinese loan repayment and stands the risk of paying a penalty amounting to N41.31 billion. The report quoted the Debt Management Office (DMO), which said Nigeria has failed to fully service its debt to China, which has accumulated to N110.31 billion in the last two years.
It would be recalled that SERAP had in December 2019 filed a lawsuit against Ms Ahmed over failure to “disclose information and specific documents on the total amount of money paid to contractors from the $460 million loan obtained in 2010 from China to fund the apparently failed Abuja CCTV project.”
The suit number, read in part: “Servicing Chinese loans for failed projects is double jeopardy for Nigerians—they can neither see nor benefit from the projects; yet, they are made to pay both the loans and the accrued interests.”
“The $460 million loan got for the failed Abuja CCTV project and the N1.5 billion for the construction of CCB headquarters, which may be part of another Chinese loan, may have been mismanaged or stolen, and in any case, remain unaccounted for.”
“Transparency in the spending of Chinese loans is good for everyone, as this would help to increase the effectiveness, legitimacy, and contribution of the loans to the development of public goods and services, and the general public interests.”
“The information being requested does not come within the purview of the types of information exempted from disclosure under the Act. The Respondent has no legally justifiable reason for refusing to provide SERAP with the information requested.”
“Democracy cannot flourish if governments operate in secrecy. The citizens are entitled to know how the commonwealth is being utilized, managed and administered in a democratic setting.”
Nigerian Education Loan Fund (NELFUND) has said that Nigerian students will need to present their Unified Tertiary Matriculation Examination registration number (UTME); National Identification Number (NIN); and Bank Verification Number (BVN) to access student loans.
Mr Akintunde Sawyerr, managing director of NELFUND, assured that the body would ensure that those he called ‘ghost students’ would not have access to the soon-to-be-launched scheme.
The MD noted that NELFUND has put processes in place to ensure that all applicants and beneficiaries are traceable to prevent the loan from turning into a sort of national cake.
“We are using technology to run the system. The process of application is online and we are limiting human contact as much as possible. Once you have a Bank Verification Number, BVN and National Identification Number, NIN, which are parts of the requirements, we will have access to your data and all your accounts. This will also help us to know if you are qualified or not,” he explained.
He explained further that those who are already in school can apply for the loan at any level of their study, but must be at the beginning of each session. They would also have to provide their admission and matriculation details in addition to BVN and NIN.
According to the NELFUND boss, about 1.2 million Nigerian students in tertiary institutions and government-recognized skill acquisition centres would be among the first batch of beneficiaries. The number may increase as time goes on.
The programme, he noted, will be funded with one per cent of the total annual collectable revenue by the Federal Inland Revenue Service (FIRS), which will amount to N194 billion if the agency meets its projection.
He explained that the loan would be paid in two segments. The first, he said, is the chargeable school fees which would be paid directly to the institutions while stipend would be paid into individual student’s account for day-to-day upkeep.
Mr. Sawyerr stated that the amount individual applicants will access will vary because of the course of study, school fees payable and geographical location of the institutions among others.
On the method of payback, he said, “You don’t start paying back the loan until two years after your National Youth Service Corps, NYSC Scheme and that is, if you have secured a job or business. A beneficiary can defer repayment if he has not secured a job, but if after due diligence, he defaulted, then he becomes a criminal and we will work with every agency that can help us get the money back, for example, EFCC, ICPC etc.”
Sun International Limited, run by Anthony Leeming, South African entrepreneur, has agreed to sell its Nigerian interests to Rutam Finance Company Limited (RFC) for roughly $14.4 million.
The move is part of Sun International’s strategy to consolidate operations and focus on key markets. Sun International joined the Nigerian market in 2009, but has struggled in recent years due to a challenging operating climate.
This divestiture is consistent with the company’s strategic objectives and represents a shift in portfolio management.
Sun International, will sell a 43.3 percent ownership investment in Tourist Company of Nigeria PLC (TCN), which manages Lagos’ Federal Palace Hotel, to RFC for $1.875 million.
In addition, the group would pay off its whole $12.675 million credit to RFC, effectively exiting the Nigerian market. The corporation also intends to sell its remaining 6% ownership in TCN in due course.
The transaction, subject to customary closing conditions including as regulatory approvals, is estimated to create a cash inflow of about $14.41 million for Sun International.
These funds will be utilized to reduce debt.
Following the completion of the acquisition, TCN will no longer be included in Sun International’s financial statements.
This will reduce group debt by about $41.82 million, excluding IFRS 16 lease liabilities.
The closing is scheduled for no later than May 28, 2024, provided that all usual closing conditions are met. The Nigerian Competition Authority, the Securities and Exchange Commission, and the Nigerian Stock Exchange have all provided key clearances.
Sun International, founded in 1968 by the late Sol Kerzner, has grown into a renowned gaming and resort company under Leeming’s leadership.
In fiscal 2023, the company’s revenue increased by 7% to $646.14 million, while headline earnings increased by 86 percent to $55.35 million.
This demonstrates Sun International’s resiliency and strategic direction. Sun International’s pullout from Nigeria demonstrates the company’s dedication to streamlining its portfolio and pursuing growth possibilities in key areas.
With a rich history and a focus on the future, this transaction demonstrates the company’s commitment to create wealth for shareholders and stakeholders while also strengthening its position in the gaming and hospitality industries.
Sam Darwish, a US-Nigerian telecom entrepreneur, has experienced a huge financial setback in his holding in IHS Holdings following a recent drop in the shares of the top telecom infrastructure company on the New York Stock Exchange (NYSE).
Sam Darwish
According to data, Sam Darwish’s investment in IHS Holdings has lost $6 million in market value during the last 13 days. This drop reflects increasing selling pressure among NYSE investors.
From March 12 to 30, Darwish’s investment in IHS Holdings increased from $35.17 million to $49.27 million, resulting in a $14 million gain.
Darwish founded IHS Holdings in 2001, and it has since grown to become the largest telecom infrastructure business in Africa, Europe, Latin America, and the Middle East.
It is renowned for its huge tower count and is the world’s third-largest independent international tower firm.
In the last 13 days, IHS Holdings shares on the NYSE have dropped by 11.72 percent, from $3.67 on April 3 to $3.24 at the time of writing.
As a result, the company’s market capitalization has dropped below $1.1 billion, causing significant losses for stockholders.
As chairman and CEO of IHS Holdings, Sam Darwish holds a critical position in African telecom.
With a strong 4.17 percent ownership holding, equivalent to 13,958,158 ordinary shares, he is a key participant in the global telecom infrastructure business.
The recent double-digit loss in IHS Holdings shares has resulted in a $6 million decrease in the market value of Darwish’s shareholding in the top telecom infrastructure company. His shareholding has decreased from $51.23 million on April 3 to $45.22 million.
Despite this defeat, Darwish remains an important figure in the worldwide telecom business.
IHS Holdings’ extensive tower network and smart acquisitions have secured its position as a major participant in the global telecom infrastructure sector.
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