Buhari Rejects Obasanjo’s Counsel On Multi-Billion Loan

The Muhammadu Buhari-led federal government is pushing ahead with plans to secure $29.9billion loans in spite of scathing criticisms from ex-President Olusegun Obasanjo.

It was learnt that President Buhari has directed the Minister of Finance, Kemi Adeosun, to engage the ex-President on the facts-behind-the-figures in respect of the loans.
The Finance Minister, who is said to be a “goddaughter” of the ex-President, may also get a feedback from Obasanjo to the government.

According to investigation conducted by The Nation, the Buhari administration has discovered that Obasanjo does not have sufficient information on the loans.
Findings indicated that the Federal Government has decided to ignore calls that it should shelve the loans and had resolved to engage Obasanjo and convince him on the need for the loans.

It was gathered that the government would also make the details available to Baba to prove that the loans would not amount to fresh “debt traps.”

A top source said: “We are going ahead with the loans, but we will allay the fears of ex-President Obasanjo with necessary documents on the sources and plans.

“I think the ex-President needs some details. We are certainly going to engage Obasanjo. We will not take issues with him in the media.
“ It is to the credit of Obasanjo that he secured debt reliefs for the nation. We want him to realize that we are not out to pile up fresh debts for the nation.

“These loans are coming from some liberal creditors including the World Bank, Africa Development Bank (AfDB), Islamic Development Bank (IDB), Japan International Co-operation Agency (JICA) and China EximBank.

“What Nigerians do not know is that we had many offers but were careful in selecting our loan facilitators.

“For instance, the Buhari administration rejected loan offers from the International Monetary Funds (IMF) because of Nigerians’ attitude to the international agency for such a bail out in 1990.

“Yet out of the $29.9 billion loans, the Federal Government’s share is $25.8 billion while the states will enjoy $4.1 billion facility.”
The source gave insights into the loans as follows:

The external borrowing plan is a three-year plan covering proposed projects for 2016 – 2018. As such, the borrowings will be phased over the three-year period.
The borrowings are highly concessional (non-commercial) with low interest rates and long tenors.
The funding is being sought from multilateral institutions including the World Bank, Africa Development Bank (AfDB), Islamic Development Bank (IDB), Japan International Co-operation Agency (JICA) and China EximBank.

The planned Eurobond issuance in the international capital markets is the only commercial source of funding.
The source said: “There is no way we can even implement 2017 budget without the loans. We are in dire straits. We need some breather to revive the economy.

“It is not physical cash as being assumed. All the institutions will be involved in the management of the loans to ensure judicious use.

“And for a prudent government like that of Buhari, there is 100 percent assurance that the loans will not be mismanaged unlike the case in the past.”

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