Amaechi speaks on sovereignty clause in $500m Chinese loan

Minister of Transportation, Rt. Hon. Chibuike Rotimi Amaechi, has explained that the clause ‘waiving sovereignty’ in the loan agreement between Nigeria and China was only a contract term, a sovereign guarantee that assures payback according to the terms and conditions of any loan.
Amaechi made the clarification while answering questions about the loan controversy on a TV programme, on Friday.
He also explained that the Ministry of Transportation was not responsible for taking loans, but to implement the project or contract for which the loans were taken.
He said, “It is a commercial agreement, it’s a trade agreement between Nigeria and China. The first issue is that Ministry of Transport does not take loan. Anything about loan, talk to Ministry of Finance. What I signed is what they call commercial contract that is contract between the federal government and CCECC as a contractor.
“The contract between Nigeria and China is usually signed by the Ministry of Finance on behalf of Nigeria, but that will be escaping the issue. Whether it is the Ministry of Finance that signed it or the Ministry of Transport, the issues are the issues. There is no contract without an agreement and that agreement must contain some terms and one of the terms that this one contains, is not that you’re signing away the sovereignty of the country. What you do is, you give a sovereign guarantee; and I’m ashamed of those who interpret it the wrong way.
“Now, when you say ‘I give you a sovereign guarantee and I waive that immunity clause, the immunity clause is that, if tomorrow I’m not able to pay you and you come to collect the items that we’ve agreed upon, that these are items I have put down as guarantee, I can waive my immunity and say no, you cannot touch our assets, we are a sovereign country. They (the Chinese) are saying, if you are not able to pay, don’t stop us from taking back those items that will help us recover our funds. And it’s a standard clause, whether it’s with America you signed it or with Britain or any country, because they want to know they can recover their money. What the clause does is to say to you, I expect you to pay according to those terms and conditions. If you don’t pay, don’t waive your immunity on me (the lender) when I come to collect back what is the guarantee you put forward.
“The waiving of immunity simply means in trade parlance that I’m not giving you this loan free of charge. Just like if you go to take a loan from the bank, the moment you don’t pay, they go after the assets you put down. And people are politicising it.
Allaying the fear of some Nigerians asking if it’s possible to repay the loan, Amaechi stated that the loan was already being repaid.
“But we’re paying, he said. “In the same National Assembly committee sitting, they were told that out of the 500 million dollars, we’ve paid 96 million dollars already. Nigeria is already paying… So, it’s not that Nigeria doesn’t have the capacity to pay back. We’ll pay back. At 2.8 per cent, what other country would give you that loan? 2.8 per cent for 20 years with seven years moratorium, why can’t you pay back? The repayment plan is not done by us, it’s done by the Ministry of Finance, but they are meeting the requirements.”
-Thisday