The Socio-Economic Rights and Accountability Project (SERAP) has called on the 36 state governors and the FCT Minister, Nyesom Wike, to disclose the details of any Chinese loans, liabilities, and other external borrowings obtained or guaranteed by the Federal Government. SERAP is demanding full transparency regarding the terms and conditions of these loans, including provisions on collateral.
Thank you for reading this post, don't forget to subscribe!In a statement issued on Sunday by its deputy director, Kolawole Oluwadare, SERAP emphasized the need for transparency. Oluwadare urged the governors and the FCT Minister to provide comprehensive information about the repayment obligations associated with these Chinese loans, including interest rates, instances of default, debt restructurings, and the extent of debt exposure to China and other international creditors.
The statement further requested that state and regional governments clarify any investment agreements made with Chinese companies and provide details on the repayment history of these loans, as well as liabilities and facilities obtained from China and other external creditors guaranteed by the Federal Government.
“We are concerned that your state and the FCT may have failed to efficiently manage your debt obligations, particularly regarding external debt and investment obligations guaranteed by the Federal Government,” the statement read. It pointed out that non-compliance with debt obligations could contravene Section 6 of the Debt Management Office Establishment Act, posing financial risks and exposing Nigeria to potential repercussions related to these Chinese loans and other external borrowings.
SERAP expressed concern that these Chinese loans and other external borrowings might not have been used for their intended purposes, as guaranteed by the Federal Government. There is also a significant risk of default on these loans, which could lead to the confiscation of Nigerian assets in foreign jurisdictions by multilateral and bilateral agencies and other creditors if the states and the FCT fail to meet the terms and conditions of the loans.
The statement highlighted the lack of adequate safeguards and accountability mechanisms, which could increase the risk of Nigeria’s assets being confiscated abroad. SERAP urged the states and the FCT to ensure that their spending and repayment plans for Chinese loans and other external borrowings align with national and international standards to prevent such risks.
SERAP requested that these measures be implemented within seven days of receiving or publishing this letter. If there is no response by then, SERAP indicated that it would consider taking appropriate legal actions to compel the states and the FCT to comply in the public interest.
The statement also noted that despite the numerous external loans and liabilities obtained by the states and the FCT, many Nigerians continue to lack access to regular electricity supply and have not benefited from renewable energy solutions. According to a recent report by the National Bureau of Statistics, over 133 million Nigerians live in poverty, with women and children being the most affected.
SERAP voiced serious concerns about the alleged mismanagement of public funds by many of the country’s 36 states and the FCT, which may include Chinese loans and other external borrowings. The organization called on the governors and the FCT Minister to disclose details of how these funds are being spent, including information on the projects financed, their locations, implementation status, and any available completion reports.
