The Minister of Transportation, Rotimi Amaechi has disclosed that the loan the Nigerian government got from China for the rail projects across the country will be paid back within 20 years.
In a statement released on Saturday August 1, the former Governor of Rivers state disclosed that China is the only country giving out loans with a low interest rate of 2.8 per cent.
Amaechi further stated that the loan which can be paid back over a span of 20years and at the rate of 2.8 percent, said it is needed to boost infrastructural development across the country and only assets constructed with such loans will be taken back in case there is a default in repayment.
“What you do is you give a sovereign guarantee and that guarantee is the immunity clause they are talking about.” He said.
“When we say, I give you a sovereign guarantee and we get immunity clause, the immunity clause is that, if tomorrow I am not able to pay and you come to collect the items we have agreed upon, that these are the items that am putting down as guarantee, I can waive my immunity and say no you can’t touch it am sovereign country.”
“So, they are saying, if you are not able to pay, don’t stop us from taking back those items that will make us recover our funds. So, is China our father that will give us money for free?”
“It is a standard clause in every agreement whether is America we signed it with, whether is Britain, any country would want to know that they can recover their money.”
“Anybody that is saying he doesn’t know what a sovereign guarantee or immunity is, too bad for the person, because it simply means in trade that I am not giving you this loan free of charge.”
“Just like you go to the bank to collect a loan, the moment you don’t pay they go after your assets you put down, that is all about the clause, the Chinese can never come and take over Aso rock and become President or Minister.”
“And if the assets you put down become depreciated then you negotiate which assets they can go after. Chinese will never take over what was not constructed with the loan.”
“The Chinese is just asking us to show them the evidence that we will pay back, which is the immunity clause. If we don’t pay, they can take back their assets.” the Minister said in brief.
Commenting on the Zambian experience, Amaechi reiterated that the Chinese government will never take over infrastructure that was not constructed from the money taken.
He also disclosed that the federal ministry of finance has started paying back some of the loans.