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$22.7bn loan: Group alleges exclusion of south-east, asks Exim Bank of China to halt disbursement of funds

$22.7bn loan: Group alleges exclusion of south-east, asks Exim Bank of China to halt disbursement of funds
March 17
22:10 2020
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Igbo Board of Deputies, a non-governmental organisation, has threatened to sue the federal government and the Exim Bank of China over the alleged exclusion of the south-east from the $22.7 billion loan.

The senate had approved the loan request by President Muhammadu Buhari which he said will be used to finance key infrastructure across the country.

You can read the proposed spending plan here.

Over 70 percent ($17bn) of the loan is expected to come from the Exim Bank of China, while the remaining funds will be from the World Bank, Africa Development Bank, among others.

In a letter by Okeke Attorney, its counsel, and addressed to the Exim Bank of China, the group alleged that the south-east zone was marginalised and exempted from from the loan.

The group asked the bank to suspend the disbursement of the loan or face legal action alongside the federal government.

It said it is aggrieved that the Igbo have been excluded from benefiting from the loan yet would be expected to participate in the repayment, while accusing the government of suppressing the region.

It added that by reportedly excluding the zone, the federal government violated the principle of federal character.

It, therefore, gave the bank a 14-day ultimatum to either suspend the disbursement of the fund to the federal government or “tie the loan repayment to the region of Nigeria that inherits the projects.”

“In the circumstances, we have been instructed to demand from you, as we hereby do, an undertaking within 14 days from the date hereof, that you will do the following: (a) suspend the disbursement, alternatively, cancel the approval of the loan to the Nigerian government until such time as it has revised and/or amended the manner it intends to allocate the loans so as to include projects in the South East of Nigeria, which projects shall directly benefit the Igbos.

“(b) as a condition, tie the loan repayment to the region of Nigeria that inherits the projects, as Nigeria flounders and threatens to break up; and

“(c) In going forward, kindly ensure that all projects are valued and open-bid for, following international best practices to ensure standard quality and fair cost. The present Nigerian government is prone to project cost inflation, and future generations are not obligated to pay for fraudulently inflated costs.

“Failing which, we hold instructions to join you as a Defendant party to the planned law suit against the Federal Government of Nigeria. We shall take this matter to its logical conclusion, even if it means going to the International Court of Justice “ICJ””.

The senators from the south-east have also alleged that the region was excluded in the spending plan of the loan.

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