The Former Minister of Finance and Coordinating Minister of the Economy, Ngozi Okonjo Iweala has said the alleged diversion of a $1 Billion rail loan targeted at her personality by President Muhammadu Buhari lacks substance and therefore should be disregarded.
She also said there was no way loans from the China-EximBank could be diverted since the institution keeps and disburses funds for approved projects to contractors based on milestones.
Okonjo-Iweala who stated this in a statement issued by Paul Nwabuikwu, her media adviser, said that the Kano-Lagos rail project was not among the railway projects funded by the Chinese Bank.
The Special Adviser to the President on Media and Publicity, Femi Adesina, had in a statement indicated that officials of the Federal Ministry of Transport, led by the Permanent Secretary, Mohammed Bashar, told the President during a briefing last week that a substantial part of a $1bn loan obtained from the China-EximBank by the Jonathan administration for a Kano-Lagos rail project was diverted to other projects.
In response, Okonjo-Iweala debunked the statement saying that the diversion of any Chinese funds would have been extremely difficult because the terms of the contract and the processes would simply not have permitted such action.
- “I want to state categorically that there is no truth in the reported allegation. Anyone who is interested can cross-check with the China-EximBank or the Chinese Embassy.
“The alleged diversion has no substance for the simple reason that the Kano-Lagos project was not even among the projects presented for funding by the China Exim Bank for several strategic infrastructural projects across the country.
“In fact, it was the Lagos–Ibadan rail project, not Lagos-Kano rail project that was proposed in the original application to the China-EximBank.
“But in the end, no funds were assigned for the Lagos-Ibadan rail project by the China-EximBank,” the former Minister said.
Okonjo Iweala listed projects which are at various stages of progress being funded from facilities obtained from the China-EximBank when she was in government to include $500m for the expansion of four International Airport Terminals in Lagos, Kano, Abuja and Port Harcourt, $500m for the Abuja Light Rail project, $984m for the Zungeru Hydro-electric power project and $100m for the Galaxy Backbone project.
- “It is also important to note that even if the alleged project was on the list of China-EximBank funded projects, diversion of any Chinese funds would have been extremely difficult because the terms of the contract and the processes would simply not have permitted such action.
“The procedure is that funds for approved loans remain in the China-EximBank and are released directly to the Chinese firm executing the contract only after the presentation of duly certified proof of work by the responsible Ministry, in this case it would have been the Federal Ministry of Transport, based on the agreed milestones.
“For the sake of emphasis, the China-EximBank does not disburse money directly to government and therefore the issue of diversion does not arise,” Okonjo Iweala posited.
The Governors of Edo State, Adams Oshiomhole, and Kaduna, Nasir El-Rufai, had on June 30, 2015 said that the National Economic Council, NEC, found that $2.1 billion of the Excess Crude Account, ECA, was spent without the approval of the council.
The former Minister had in a response said no unauthorized expenditure from the ECA was made under her watch in the Finance Ministry, and that decisions on such expenditure were discussed at meetings of the Federation Accounts Allocation Committee, FAAC, attended by finance commissioners from the 36 states.
- “It is curious that in their desperation to use the esteemed National Economic Council for political and personal vendetta, the persons behind these allegations acted as if the constitutionally recognized FAAC, a potent expression of Nigeria’s fiscal federalism, does not exist,” a statement signed by former minister’s spokesperson, Paul Nwabuikw stated then.
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