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$1Bn China Project Loan Cannot Be Diverted – Okonjo-Iweala

 

OkonjoDr Ngozi Okonjo-Iweala, former Finance minister, has debunked recent allegations that $1 billion China-EximBank loan for the Lagos-Kano rail project was diverted under her watch.

Okonjo-Iweala said in a statement on Sunday, “The alleged project was not 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.”

She explained that the procedure for accessing China-Exim Bank loan “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.”

She said the China-EximBank “does not disburse money directly to government and therefore the issue of diversion does not arise.”

To corroborate her defence, Okonjo-Iweala called on interested parties and individuals to “cross-check with the China-EximBank or the Chinese Embassy” because “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-EximBank among several strategic infrastructural projects across the country.”

The projects being funded with facilities from the China-EximBank and which are at various stages of progress are:

– $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.

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