President Muhammadu Buhari on Monday asked the Ministry of Finance to explain why the foreign loans obtained for various key rail projects by the Federal Government were diverted under the watch of former Minister of Finance, Dr. Ngozi Okonjo-Iweala.
President Buhari also dismissed the general notion that Nigeria is a rich country, arguing that indices and parameters of evaluating a rich country such as economic advancement and improved social services are lacking in Nigeria.
The President, who spoke at the end of a presentation by the Ministry of Transport by the Permanent Secretary, Mohammed Bashar at the Presidential Villa, Abuja, said it was disappointing to find out that foreign loans obtained in line with signed agreements were moved from one project to another.
According to a statement by Mallam Garba Shehu, his Senior Special Assistant on Media & Publicity, President Buhari was reacting to the specific instance of the diversion of a substantial part of the $1.005 billion loan from the Chinese Exim Bank, obtained for the construction of a standard gauge rail line linking Lagos with Kano but which was moved elsewhere.
The loans were obtained from China in 2012 under President Goodluck Jonathan, while Dr. Okonjo-Iweala served as Minister of Finance and Co-ordinating Minister of the Economy.
The Permanent Secretary had informed the President that only $400 million of that loan remained with the Ministry of Finance.
The President then warned that “I hope that due process was followed before such diversions were carried out. Taking money from one project to another has to be done properly.”
The President regretted that government had, over the years, failed to meet its counter-part funding obligation on some projects, leading to such projects being left uncompleted or abandoned.
He added that there was a clear need to streamline, harmonize, and priortize on-going projects in the transportation sector.
The Permanent Secretary also briefed the President on some challenges facing the transport and maritime sectors such as encroachment on railway land, lack of security on inland waterways and some vague agreements between the Nigeria Ports Authority and ports concessionaires.
Speaking to State House Correspondents after meeting the president, the Permanent Secretary said that the President directed that strict adherence should be paid to terms and agreements of various loans.
“Basically, what we did was to present to the President the various programmes, projects and the reform efforts that we have been undertaking in the last couple of years, the stages of the various projects, especially the railway rehabilitation programme and development in our seaports. Also some of the regulatory issues that we sought are due for review and attention.
“The President quite appreciated a lot of what has been achieved so far and he has indicated his willingness to continue with a lot of projects and programmes already on ground.
“He has expressed his support, especially when we started talking about capacity building for individual operators in the country. He is really appreciative of the entrepreneur initiatives of Nigerians, an indication that government will continue to give its full support.
“There are issues that he thinks we should pay a lot of attention to, especially in the execution of agreements that we have entered into. He emphasized the need to adhere strictly to the terms of agreements and we are going to abide by that.
“Basically, those agreements are relating to the projects we entered into with the construction of railway, standard gauge lines and rehabilitation programmes.
“As you are aware, we have completed the Lagos-Kano and it is operational. Twice a week, people move from Lagos to Kano and back to Lagos. We have also recently commenced operation from Kano to Port Harcourt, and Port Harcourt to Gombe and from Gombe upwards we have some challenges.
“With regards to Abuja-Kaduna, track has been completely laid and we are now waiting for locomotives to arrive, which have been ordered and paid for. Our belief is that we will meet the deadline of December, 2015”, he said.