Chinese bank rejected Nigeria’s loan request of just $22.8 billion — House of Representatives

The House of Representatives has revealed that the China-Exim Bank rejected Nigeria’s $22,798,446,773 loan request earlier approved by the National Assembly.

The Chairman of the House Committee on Rules and Business, Abubakar Fulata, stated this on Tuesday after the House approved the loan request by the Federal Government to borrow $973,474,971.38 from China Development Bank.

Fulata moved a motion titled ‘Rescission of the 2016–2018 Federal Government External Borrowing (Rolling) Plan’, for the legislative chamber to amend its resolution granting approval for the failed loan deal. Moving the motion, he said, “The House notes that the 2016–2018 Federal Government External Borrowing (Rolling) Plan was approved by the Senate and the House of Representatives on March 5, 2020, and June 2, 2020, respectively.

The House recalls that the National Assembly approved the sum of $22,798,446,773 only under the 2016–2018 Medium Term External Borrowing (Rolling) plan. The House is aware of the communications from the Federal Ministry of Finance requesting approval of modifications to the financing proposal for the Nigerian Railway Modernisation Project (Kaduna–Kano segment) occasioned by the COVID–19 pandemic, whereof China Exim Bank withdrew its support to finance the project.”

He added, “The House is also aware that to secure funds for the project, the contractor (CCECC Nigeria Limited), in collaboration with the Federal Ministry of Transportation, engaged China Development Bank as the new financier in the sum of $973,474,971.38 only.”

Fulata, therefore, prayed the House to “rescind its decision on the financier and harmonised terms and approve the change of financier from China Exim Bank to China Development Bank.” The lawmakers unanimously granted the prayer.

The House of Representatives also gave its approval for the conditions outlined in the harmonised term sheet.