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Following President Muhammadu Buhari’s signing of a $382 million loan deal with the Chinese Government, Dr Oby Ezekwesili has spoken up against it; describing it as a bad move.

In a series of posts shared today on her personal Twitter page, the erstwhile Minister and former VP of the World Bank implied that the Chinese loan is risky to Nigeria. This is because “Chinese attitude to indebtedness is the hardest in the world”, she said.

She further stated that it is annoying to see countries like Nigeria continue to collect loans from the Asian hegemon; despite the risks involved.

Meanwhile, the Chinese know exactly what they are doing…

According to Dr Ezekwesili, the Chinese are calculative and deliberate when they give loans to African Governments. They know exactly what they are doing when they design the loans to cover their exposure levels in case of uncertainties, she said.

Unfortunately, African leaders such as President Buhari continue to borrow recklessly and without recourse to all the inherent dangers.

As Ezekwesili observed, the scale of public debts is increasing steadily just as present-day politicians continue to behave like their predecessors who piled up debts.

While loans are important, care must be exercised

Dr Ezekwesili agreed that loans are inevitable, especially for a country like Nigeria and other African countries which need lots of money to finance infrastructural projects. The loans are needful as they complement locally-sourced revenue.

Yet, the country needs to be careful with its foreign debts, especially those from China. As Ezekwesili emphasised, “borrowing well is at the heart of public debt management.”

Unfortunately, this is not the case with the recent borrowing from China, she observed. According to her, Nigeria’s inefficient Government has resorted to risky non-concessionary loans from the likes of China, instead of focusing on reforming the economy for sustainable development.

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This trend should worry every well-thinking Nigerian, she said. This is why all must join hands together to solve our economic problems once and for all.

As we reported, President Muhammadu Buhari signed the loan deal during his latest visit to China for the 2018 Forum on China-Africa cooperation. The $328 million will be used to implement the National and Communication Technology Infrastructure Backbone (NICTIB) Phase 11.

3 COMMENTS

  1. Why is she complaining now? She said nothing when her former boss Obasanjo incurred millions in foreign debts. I guess she is just seeing what is wrong with borrowing now…
    Don’t get me wrong; I can see the point in what she is saying. But people like her mostly talk against the system when the system is not favourable to them. When it is fafavourable they keep quiet and enjoy.

  2. uneasy lies the head,it is this govt choice to burden us with foreign debt,a national govt must pursues it’s national interest in internationa politicsThe Chinese have started this silk initiative into foreign countries,which is devise for china to be a superpower for the next 100 yrsif not the only superpower in the next 100yrs,they have their first armed forces in east africa .a foreign govt like china must maximizes it’s national interest..they have really f-cked this nigerian govt.this is not the first Nigerian to criticizes this foreign debt,can this foreign debt prevented ?,i think it can be done if this govt have done any home grown dollar loan or bond between the CBN and the ministry of finance incorporated,However I thinked in future some new govt will do some sort of home grown loan or bond,as many Nigerian bank have done some dollar bond.
    I said in future,the economy have been clean and cleared a little bit,they will see more clear and have more insight,and they will be able to repays this foreign debt,in some form of swap,buy-back this debt or infrastructural swap,as this debt will not benefits Nigeria in any way,being this is,it will not happened with this govt or as this apc is still in power.as this new govt will renegotiate this Chinese debt

  3. Further to my comment,it is doubtful obasanjo incurred any new foreign load.The bulk of foreign loan was incurred mostly during the second republic.we must give give credit to obasanjo and Mrs iwela,who was obasanjo at once his finance minister,obasanjo was going around the globe asking for debt relief.mother luck shine on the govt of obj,oil future obligation hit 100$ per barre and it really hit 100$ per barrell,during obj forex reserve hit 70 billion dollar,where they were able to negotiate some of the debt.i think they did a dual initiative an actual repayment and a buy back some of the debt,so you should check,i think Mrs ezekwesili was right

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