Buhari's ministers fight to finish. See why

Buhari's ministers fight in China. See why

The recent trip by key members of the Muhammadu Buhari's cabinet to China to re-open discussions with the Asian country’s Exim Bank was not without drama, as it has emerged that the journey was almost marred by a spat between two of the ministers.

The fight was between the Minister of Finance, Mrs. Kemi Adeosun, and the Minister of Transportation, Mr. Chibuike Amaechi, in far away Beijing, the Chinese capital.

THISDAY learnt the misunderstanding between the ministers transpired when Adeosun did not hesitate to give Amaechi a piece of her mind for meddling in the travel arrangements of directors from her ministry to Beijing.

Her directors were forced to defer their trip and in the process missed their first meeting with officials of the China Exim Bank.

Sources who opened up to THISDAY on the incident, said Adeosun, who was in transit from Davos to Abuja via London, was called in the British capital and asked to proceed to Beijing to hold discussions with the China Exim Bank on the bilateral loans offered by the Chinese government on a number of infrastructure projects in Nigeria, including the railway and airport rehabilitation projects.

She was said to have obtained a ticket to fly with Emirates Airline to Beijing from London and called her directors with the institutional knowhow on the bilateral loans and outstanding counterpart funding agreed between the China Exim Bank and the Nigerian government to join her in China.

But on the day of the meeting, her directors who were supposed to have arrived the day before were nowhere to be seen because they were prevented from boarding their Emirates Airline flight in Abuja.

Amaechi, a transportation ministry source informed THISDAY, was scheduled to fly with his own team on the same flight from Abuja, but had taken umbrage over a contractor of his ministry who had been smuggled into the government delegation.

The transportation ministry source said: “On getting to the airport, Amaechi was angry that a contractor who had no business being on the trip had been included in the delegation.

“So he ordered his directors, those of the finance ministry and the contractor not to proceed on the trip. In the process, all of them including Amaechi missed their flight and had to buy tickets to depart Abuja in the evening on Lufthansa Airways.

“And since Lufthansa flies through Frankfurt, they missed the first meeting in the morning with the China Exim Bank.”

The source said Adeosun was not happy about the incident and confronted Amaechi demanding to know why he had to offload her own directors if he had issues with his team.

“She made it abundantly clear that he had no business offloading her directors from the flight since they knew nothing about the travel arrangements of his team.

“She told him that due to his meddling, they had missed their first meeting at the Exim Bank,” he said.

Although the source did not confirm if Amaechi apologised to Adeosun, he said subsequent meetings with the China Exim Bank progressed without incident.

“The finance minister already had briefing notes and proceeded with the first meeting on her own, but other meetings were held with the entire Nigerian delegation in attendance and they were quite positive,” he said.

He revealed that considerable progress was made on discussions on the bilateral loans and expressed confidence that Nigeria would be able to meet its counterpart funding for some of the crucial infrastructure projects.

“The meetings were very positive and we believe the airport rehabilitation and expansion projects should be wrapped up three months from now,” he said.

Meanwhile, the federal government yesterday denied a report by the Financial Times of London that it was seeking to secure emergency loans of $3.5 billion from the World Bank and the African Development Bank (AfDB) to help fund the N2.2 trillion deficit in the 2016 budget.

Reacting to the report, the finance minister said Nigeria had not applied for any emergency loans.

“The truth is that Nigeria, as part of the plan to fund the 2016 budget currently undergoing the approval process of the National Assembly, has indicated its intention to borrow N1.8 trillion principally for investment in capital projects to stimulate the economy,” the minister said in a statement issued by her media aide, Mr. Festus Akanbi.

According to Adeosun, the option of the World Bank was to ensure an optimum financing structure, adding that the 2016 budget was part of the Medium-Term Expenditure Framework (MTEF) of the federal government, which the World Bank is aware of.

The proposed budget deficit, she stressed, would be funded equally through external and domestic borrowing.

Although the federal government has debunked the report to seek emergency loans from the World Bank and AfDB, the government is tinkering with the option of approaching multilateral agencies like the World Bank and AfDB and export credit agencies, including the China Exim Bank for loans, due to their concessionary interest windows.

Providing further insight, Adeosun said the overall objective of the lending programme is to access the lowest possible cost of funds to finance capital projects proposed under the government’s plan to stimulate the economy. Capital projects include power, transport, road, housing, etc.

She explained that options with multilateral agencies, including the World Bank and AfDB were being explored.

Multilateral agencies provide loans under concessionary terms, which include low interest rates, a moratorium before repayment, and long tenors.

The second funding option being explored includes export-credit agencies such as China Exim Bank, the statement added, stressing that these funds are also concessionary and are tied to specific capital projects.

The need to invest in infrastructure to stimulate the economy and the long-term payback period for capital projects, she noted, demands that the lowest cost of funds must be obtained, adding that the balance of foreign borrowing required would be raised in the Eurobond market at commercial rates of interest.

The minister explained that by blending these different sources of funding, the overall cost of funds would be maintained at the lowest possible level.

She further stated: “As far as possible, our foreign borrowing will be tied to specific capital projects. A number of these projects are revenue generating which will be used to fund the loan repayments.”

The strategy of pursuing increased foreign borrowing is designed to ensure that the federal government does not “crowd out” the private sector in the domestic market, she said in the statement.

However, Nigeria’s bid to obtain new loans has not gone down well with former President Olusegun Obasanjo who has expressed concern that Nigeria may be on the front line list of debtor states.

Obasanjo, who was the chairman at the inaugural conference of the Ibadan School of Government and Public Policy (ISGPP) with the theme, “Getting Government to Work for Development and Democracy in Nigeria: Agenda for Change” regretted that the drastic fall in the price of oil has unravelled the weakness of governance in Nigeria.

Recalling the efforts made by his administration to rid Nigeria of its external debt burden incurred since the 1960s, Obasanjo said: “A few years ago we rescued Nigeria from its creditors with the deal in which the Paris Club of sovereign creditors wrote off $18 billion of debt, Africa’s largest debt cancellation. Nigeria then used windfall earnings from oil exports to pay off another $12 billion in debts and arrears.”

He added: “Falling commodity prices have put pressures on local currencies, and if caution is not taken, may lead to mounting debts.

“So it is indeed proper for us in Nigeria to ask the question is the government working? Is government positioned to deal with challenges arising from these new developments?

“These question are made apposite by the massive scale of poverty and unemployment, the decay in infrastructure facilities, the impoverished living standards of citizens with regard to food, housing, water supply, education and healthcare which have deepened in recent years.

“This is complicated by the protracted experience of violence and brutality, the flow of internally displaced persons arising from the Boko Haram insurgency in large parts of north-eastern Nigeria where many citizens have become distressed, live in fear and insecurity.

“Recent developments in governance show the failure of systems, the disregard for institutional processes and the general decline of institutions that used to function to guarantee reasonable service delivery to citizens.

“When I assumed office in 1999, though I had some sense that the bureaucracy of government that I left in 1979 had significantly declined, I only appreciated the extent of this decline after the Dr. Christopher Kolade Panel that I set up submitted its report.

“I implemented remedial measures and a reorientation programme coordinated by Professor Adebayo Adedeji. I got the Management Service office to undertake and evolve a National Strategy for Public Service Reform.

“The reform process commenced in 2003 and by 2007 significant progress had been made. Unfortunately, the evidence available today shows that those gains have been reversed. The problem today is that it is doubtful if the current administrative system is imbued with right mix of skills and values to successfully implement a well-articulated programme of change.”

He also referred to his recent letter to the National Assembly, and called on Nigerian lawmakers to open themselves to public scrutiny in order to ensure accountability, transparency and good governance “in this era of change”.

He chided leaders of the country including the National Assembly, governors and others who had led the country in one way or the other for misplaced priorities.

The ex-president urged members of the National Assembly to live by what it preaches, just as he decried the diversion of local government funds by the governors across the country.

In his keynote address, a former Secretary-General of the Commonwealth, Chief Emeka Anyaoku, called for the total restructuring of the system of governance in order to address the nation’s present challenges.

He said the high cost of governance has continued to have negative effects on the system and has handicapped many states of the federation.

Giving a practical example, Anyaoku said many states owe workers and several were finding it difficult to pay salaries, even the agreed 18,000 minimum wage.

He urged leaders to embrace the type of federalism that worked for countries like Canada, Australia and United States of America (USA).

The event which ends today had in attendance the Oyo State Governor, Mr. Abiola Ajimobi, represented by his deputy, Mr. Moses Adeyemo; Minister of Solid Minerals Development, Dr. Kayode Fayemi; former Minister of Communications Technology, Dr. Omobola Johnson; former Head of Service, Professor Oladapo Afolabi; former Executive Secretary of the National Universities Commission (NUC), Professor Peter Okebukola; Professor Pat Utomi; Dr. Tokunbo Awolowo-Dosumu; Professor Tunde Adeniran; Bishop Ayo Ladigbolu; Professor Jide Osuntokun; and Vice-Chancellor of the University of Ibadan, Professor Abel Olayinka, among others.