A federal high court in Abuja has ordered President Muhammadu Buhari’s administration to account for the spending of a $460 million Chinese loan that was meant to fund the Abuja closed-circuit television (CCTV) project, which has failed to deliver on its objectives.
The court also ordered the government to publish the names and details of the Chinese and local companies and contractors that received funds from the loan, as well as the status of the implementation of the project.
The judgement was delivered by Justice Emeka Nwite in response to a freedom of information suit filed by Socio-Economic Rights and Accountability Project (SERAP), a civil society organization that promotes human rights, transparency and accountability in Nigeria.
SERAP had sued the Minister of Finance, Zainab Ahmed, in December 2019 for failing to disclose information and documents on the total amount of money paid to contractors from the $460 million loan obtained in 2010 from China to fund the Abuja CCTV project.
Ahmed had admitted that Nigeria was servicing the loan, but said she had no explanations on the status of the project.
Justice Nwite agreed with SERAP that there was a reasonable cause of action against the government and that accounting for the spending of the $460 million Chinese loan was in the public’s interest.
He said that the Minister of Finance was in charge of the country’s finances and could not be unaware of the amount of money paid to the contractors for the Abuja CCTV contract and another contract for the construction of the headquarters of the Code of Conduct Bureau (CCB).
He also ordered the government to provide details on whether the sum of N1.5 billion paid for the failed CCB contract was part of another loan obtained from China.
According to SERAP, this is a victory for justice, rule of law, transparency and accountability. The organization urged President Buhari and Abubakar Malami, Attorney-General of the Federation and Minister of Justice, to immediately comply with the court orders and publish details of spending of all Chinese loans and other loans obtained by his government since May 2015.
Nigeria’s total borrowing from China rose 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 this 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.
There are reports that Nigeria risks losing key national assets to China in the event that it defaults in paying back loans obtained from China. There are also reports that Nigeria may have defaulted on Chinese loan repayment and stands the risk of paying a penalty amounting to N41.31 billion.
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