China debt: Lawyers, activists seek way out of dilemma


China debt: Lawyers, activists seek ways out of dilemma


By John Eche


Emergent revelations that Nigeria’s debt exposure to China may have been secured in potential breach of the nation’s sovereignty has triggered an uproar of sorts countrywide with many lamenting how the nation’s public officers could have consented to such damaging agreements in the first place.

This is coming on the heels of a House of Representatives investigation into the terms of the loan deal between the Federal Republic of Nigeria and the Chinese authorities in respect of the financing of railway and other infrastructure in the country.

Part of the challenge however is that the stated terms of agreement tend to suggest that the Chinese have a clear upper hand to resolve any potential default or breach exclusively in their favour.

In one particular instance, the agreement signed by the Federal Ministry of Finance (Borrower) on behalf of Nigeria and the Export-Import Bank of China (Lender) on 5th September, 2018, Article 8(1) of the agreement, provides that: “The Borrower hereby irrevocably waives any immunity on the grounds of sovereign or otherwise for itself or its property in connection with any arbitration proceeding pursuant to Article 8(5), thereof with the enforcement of any arbitral award pursuant thereto, except for the military assets and diplomatic assets.”

‘But how could they have done this to us. It is like beating up a man with his two hands tied behind him,’ one activist queried.

On potential ways out of the dilemma for Nigeria, the Convener of the Public Interest Lawyers intiative, Barrister Abdul Mahmud says that pointers at the moment are that this is indeed a quite tricky and tough situation for the nation:

‘It is a complicated process as it is a bilateral commercial agreement. However, if the agreement is a treaty agreement, it can be nullified on the basis of Section 12 (1) CFRN 1999 since it wasn’t enacted into law by NASS. My sense is that it is a commercial agreement, so we can seek for review of the offensive clauses.’

The $850m dollar loan had been initiated to help finance rail and other related infrastructure projects in the country.

The investigation into the troubling affair continues on August 17 with Transportation Minister, Rotimi Amaechi, Communications Minister, Isa Pantami, DG, Debt Management Office, Patience Oniha and Finance Minister, Zainab Ahmed billed to appear before the House of Representatives that is investigating the issue.


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