Home BUSINESS BANKING & FINANCE It Is A Lie, $600 Million Foreign Loan For Rail Not Missing...

It Is A Lie, $600 Million Foreign Loan For Rail Not Missing – Okonjo-Iweala

Financial Minister, Okonjo Iweala
Financial Minister, Okonjo Iweala


Former Finance Minister, Ngozi Okonjo-Iweala, has put to lie,  the allegation that $600 Million out of the $1bn Chinese loan obtained for railway projects was diverted.

in a statement issued TODAY by her Media Adviser, Paul Nwabuikwu, the former minister said that contrary to the allegation, the Kano-Lagos rail project was not part of the project listed for funding from the Chinese loan.

It would be recalled that President Muhammadu Buhari had last Monday, queried the Ministry of Finance over alleged diversion of foreign loans obtained for rail projects by the administration of former President, Goodluck Jonathan.

Buhari, specifically sought clarification on alleged diversion of a substantial part of a $1.005bn loan obtained from the Chinese Exim Bank for the construction of a standard gauge rail
line, linking Lagos to Kano.

But Okonjo-Iweala, who spearheaded the negotiation for the loan during her time as finance minister, said that the China-Exim Bank kept and disbursed funds for approved projects to contractors based on milestones, adding  that the funds were not domiciled in the Finance Ministry.

She gave a breakdown of the loan and how it was utilised, saying that $500m was used 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.

According to Okono-Iweala, even if the alleged project was on the list of China-Exim Bank 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.

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“We have continued to receive media inquiries regarding an allegation reportedly made by the Permanent Secretary, Ministry of Transport, Alhaji Mohammed Bashar, 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.

“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

“It is noteworthy that even though President Buhari, in his reported comments on the allegation, made no reference to Dr. Okonjo-Iweala but rightly stressed the need for due process and transparency in the execution of public projects, a sponsored media campaign has once again been launched by political elements to make the former Minister the culprit in a non-existent

“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 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.” [myad]



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