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Furious Amaechi Blasts Lawmakers Over Chinese Loan Clause Expose.

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Minister of Transportation, Mr. Rotimi Amaechi, says the decision by the House of Representatives to go public on the Sovereignty Immunity Clause in the Chinese loan has delayed the approval for the $5.3bn Ibadan-Kano standard gauge project.
The House of Representatives and Amaechi were at daggers drawn last year over the sovereignty clause in the loan agreement with the China Exim Bank which funded the Abuja-Kaduna and Lagos-Ibadan standard gauge trains.
The lawmakers had queried the inclusion of the clause which gives China access to some national assets in case the Federal Government is unable to fulfill its repayment obligations but the Minister had warned that such discussion could make China have a rethink on the loan.
Speaking in an interview on Channels TV, Amaechi said the “selfishness” of some members of the House of Representatives delayed the approval of the loan by China as they began to ask more questions.
He said, “That is where we are. The loan for Ibadan-Kano, up till now we have not gotten approval and as at the time that issue happened, we were at the verge of getting approval but they withdrew. So they were asking more questions.
“The other countries we have loan agreements with, they don’t usually ask for sovereignty clause because they trust you. They expect that you pay back. But the moment you brought it to the public, they are saying, ‘Oh you gave China an immunity clause, so you must also give us.’
‘I don’t know what those lawmakers want’
“The selfishness of those members, I don’t know what they are pursuing has put the country into jeopardy. Now the other countries are asking for the immunity clause in their own agreement. The other aspect that I said was that the Chinese may likely withdraw, that is where we are. We are talking to them. Be rest assured that we would pay back. The fact that these members were investigating should not stop you from… they are doing their legitimate duty, it doesn’t stop you from lending us the money.
“They are asking questions that we need to explain. We have explained. They promised to give us the loan but at least it held us back from June till now. Imagine if they had given us that money in June, we would have gone far. We have started clearing by now but imagine seven months wasted because a few members of the House of Representatives went to the public because whatever you do here is reported all over the world. That is where we are.”
The Minister explained that what the immunity clause does is to give access to the Chinese to go to Court or Arbitration if the nation breaches the loan agreement.
According to him, the clause also gives exemption to some national assets if the court awards compensation to China in case Nigeria is taken to the court of arbitration.
“I have explained over and over. What the immunity clause does is to say to you in case you are not able to pay back, I want to be given the opportunity to be taken to court or to arbitration as it is in the clause. So when I go to arbitration, don’t come and wave immunity that I am a sovereign nation, you can’t take me to court.
“So what the immunity clause does is that it gives you access to court. But in case you are not able to pay back whether there is an immunity clause or not, there are things that the court would tell you.
“These are things to go for. What the immunity clause even does for us as Nigeria is that you can go for everything in case the court awards you but you can’t go for our diplomatic assets outside the country because that is the easiest for them. They will just go to one country and seize our assets.”
The Minister disclosed that the Federal Government has so far borrowed about $2.5billion from China for covering the $500m Abuja-Kaduna line and the Lagos-Ibadan line which is almost completed.
“If you look at the whole total cost, it will be $2.5 to $2.6 billion that we have borrowed from China Exim bank for the Abuja-Kaduna and Lagos-Ibadan.
“They also lent us about $1.4 billion for the Lagos-Ibadan while the Federal Government had to cough out about $200 million to make it $1.6 billion. We are bringing out about $700 million because we have to end at the seaport in Apapa which was not part of the original design. So we had to take about 45kilometres rail from Ebute-Metta into Apapa seaport,” he explained.

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Access Bank Vs Late Sunny Odogwu: Moving against Recalcitrant Debtors

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The recalcitrant attitude of debtors who take depositors funds by way of loan facilities with no intention to repay has once again come into public focus with the recent dispute between the Estate of the late Chief Sunny Odogwu, and his related companies.

While it is not in dispute that a facility was taken from the bank to finance a hotel project at 31-35, Ikoyi Crescent, Ikoyi, Lagos, the said facility is yet to be repaid.

The impression being created by the Estate of the late Chief Odogwu and his related companies that they can take depositors funds to finance projects and rather than repay such funds, they would make false claims to the ownership of the assets of the debtors as inheritance to be shared is a vivid reminder of the era of failed banks in the country.

The dubious attempts by the Estate of the late Sunny Odogwu to rewrite the terms of the facilities is not only a show of shame but a clever attempt by the family to inherit dubious assets gotten from depositors’ funds which does not form part of the estate and as such should not be allowed.

It would be recalled that the defunct Diamond Bank Plc, an iconic bank comparable to Eastern Nigeria’s African Continental Bank (ACB) almost went under due to recalcitrant borrowers and the bank was rescued by Access Bank Plc.

Unfortunately for the Estate of the late Sunny Odogwu and his related companies, the facts of the matter, terms of the loans and the dispute has been litigated and pronounced upon by the Federal High Court and the Odogwu Family had the opportunity to present their own side of the story which they did before Hon. Justice Saliu Saidu of the Lagos Division of the Federal High Court in suit number: FHC/L/CS/1633/14, in November 3, 2015.

Delivering judgment in the suit, Hon. Justice Saidu held that the first to third defendants were in fundamental breach of the contract for the financing of the construction of the Luxury Collection Hotels and Apartments, having admitted, “Indebtedness to the plaintiff in the sum of N10, 252,315,567.28 on the project finance facility as at December 20, 2011.”

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Additionally, the learned trial judge held that the first to third defendants have not produced before the court any evidence that any of the conditions for the grant of the facility was waived or demonstrated to the court how they liquidated their indebtedness.
His words: “With all the facts before me, I am satisfied that the first to third defendants who have admitted indebtedness has not shown how the indebtedness was liquidated.

Flowing from these grounds, Justice Saidu made the following consequential order: “Judgment is entered in the sum of N26, 229,943,035.22 jointly and severally against the 1st to 3rd defendants being the outstanding sum as at September 30, 2014 advanced by the plaintiff for the 1st to 3rd defendants’ project which sum has remained unpaid despite several demands.

“That leave is granted to the plaintiff to foreclose and sell the said property situated at 31-35 Ikoyi Crescent, Ikoyi, Lagos and to deposit the proceed of the sales into the 1st defendant’s account kept with the plaintiff towards the partial satisfaction of the judgment sum against the 1st to 3rd defendants.

“That leave is granted the plaintiff with the supervision of the Court’s Registrar to sell property situated at No 31-35 Ikoyi Crescent, Ikoyi, Lagos being the security for the sum of N26, 229,943,035.22 advanced by the plaintiff to the 1st to 3rd defendants for the development of the project called Luxury Collections Hotels and Apartments, the repayment of which facility, the 1st to 3rd defendants have failed, refuse otherwise neglected to make despite several demands.”

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It was against this background that the Estate of the Late Odogwu entered into a settlement agreement in May 2019 on the matter.

The key parts of the settlement include the following: “The defendants (the Estate of the late Sunny Odogwu and his related companies) agreed to sell a property described therein as the (Berendo Property”) in Los Angeles and to pay the sum of $11,111,111.11 within (60) days from the date of the settlement agreement to the Bank, failing which, the ownership of the Berendo property was to be assigned to the Bank, and the defendants also agreed with the bank in satisfaction of the outstanding settlement amount after receipt of the net proceeds of the sale from the Berendo property to assign such additional properties directly to the bank by way of an agreed asset swap arrangement subject to the terms of this settlement agreement.

Also, the defendants agreed to provide the bank with all the original documents pertaining to certain properties after the execution of the settlement agreement and undertook to execute and provide all documents required to perfect the legal interest of the Bank in such properties and also perfect the asset swap for the purpose of liquidating the outstanding settlement amount with the bank and shall provide such warranties and representations including without limitation, clean, undisputable and unencumbered title with quiet and peaceful possession. All these shall be achieved within seven days from the date on the settlement agreement.

Furthermore, the defendants failed to facilitate/conclude the sale of the Berendo property, hence the sum of $11,111,111.11 has not been received by the bank in line with the settlement agreement. Consequently, the defendants have failed and refused to assign the Berendo property in Los Angeles to the Bank. Rather, the defendants compromised the property at Los Angeles without paying the agreed sum to the bank.

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Furthermore, the defendants refused to hand over the Dubai property to the bank in line with the settlement agreement. The defendants have refused to grant vacant possession to the properties at Kirikiri as well as the Dubai property till date in line with the settlement agreement.

Recalcitrant debtors negatively impact the critical banking sector and defeat the essence of granting such facilities to aid business growth.

Regrettably, the Estate of the late Sunny Odogwu instead of repaying the facility in line with the terms of the settlement have apparently opted for assets stripping and have failed to comply with the settlement agreement.

The idea or impression that the beneficiaries of the estate of the late Sonny Odogwu can lay any claim of ownership to an asset acquired from depositor’s funds of a financial institution as forming part of the estate when they are aware that the underling facility has not been repaid is not only sad but actionable. And this is exactly what the Failed Bank Act seeks to prevent.

At the end of the day, depositor’s funds are savings by hard working Nigerians who believe in the financial system.

Banks are merely custodian of this funds and as custodians, when banks grant credit facilities to customers to finance and fund assets and projects, such assets do not form part of the estate of the customers for the beneficiaries to share and leave luxurious lifestyles at the expense of the depositors, until such facilities are fully repaid.

 

Access Bank Plc has remained resolute in its determination and in its typical manner of dealing with chronic and recalcitrant debtors, has indicated that it will continue to deploy every legal available resource to ensure that this debt is fully recovered.

This is why dodgy and chronic debtors like these must steer clear of accessing facilities from Access Bank Plc.

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Dangote Refinery to Reduce Africa’s Petroleum Importation by 36%, says APPO

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African Petroleum Producers Organisation (APPO) has said that the establishment of Dangote Oil Refinery will bring about a 36 per cent reduction in the importation of petroleum productions into the continent.
Besides, the organisation expressed a belief that the success of Dangote Refinery project could incentivise the rise of similar projects across Africa despite the current focus on energy transition.
The Secretary-General, African Petroleum Producers Organisation, Dr. Omar Farouk Ibrahim, said in an interview that Dangote Refinery shall be supplying over 12% of Africa’s products demand when it becomes operational.
Ibrahim stated, “To appreciate the impact that the Dangote refinery is going to have on African economies and especially on the supply of petroleum products, and to some extent the conservation of scarce foreign exchange, a look at some statistics on the continent’s petroleum products demand and supply is in order.
“Currently, Africa’s daily petroleum demand is 4.3 million barrels per day (mbd). Of this volume, 57% is produced locally (on the continent) while 43% is imported. When Dangote is fully onstream, the percentage of Africa’s products import shall drop to 36%. This is even as the total volume of products demand rises to 5.4 mbd. You can therefore see the huge impact that Dangote refinery shall be making to overall products supply in Africa. Dangote shall be supplying over 12% of Africa’s products demand.
“That is huge savings for a continent that has scarce foreign exchange and little to export. We shall save from buying abroad and from shipping and insurance costs. Furthermore, the success of Dangote could incentivise the rise of similar projects, the noise about energy transition notwithstanding,” oil analyst noted.
Ibrahim also hailed Dangote’s decision to go ahead with the construction of crude oil refinery despite a campaign against fossil fuels, adding that the demand for fossil fuel is going to continue for several decades to come.
“We believe that Dangote made a very wise decision to proceed with the project, despite the campaign against fossil fuels. There will be demand for petroleum products for many decades to come. Indeed, we see petroleum products prices rising steadily in the next few years for at least two decades.
“This is because new refineries are not coming up in Europe and North America, where Africa imports 34% of its supplies, because their governments have embraced energy transition, some willingly, others due to pressure. So, some of the sources of Africa’s imports are going to dry up. At the same time, Africa will not be in a position to fast track the development of non-fossil fuels.
“In fact, even the developed countries will not be able to move as fast as is projected. We see Africa and many regions of the world continuing to rely on fossil fuel energy at a time when deliberate decisions are being made to stop funding fossil fuel projects. The world risks abandoning fossil for renewable, but in the end not getting the renewables, and at the same time losing the fossils due to deliberate neglect”, he explained.
Ibrahim urged African refiners to invest more on technology and develop the right expertise to manage their refineries, which are going to serve the continent as western refiners halt the establishment of more refineries.
He stated, “African refiners have no cause to worry about their investments. All they need to do is to ensure that they have developed the right expertise to manage their refineries, get honest managers and staff to run their business and come together to join APPO’s initiative to establish foundries and other equipment manufacturing plants to service their refineries. Once they have these, the market is there for their products.
“For the next three decades or more, Africa shall continue to use fossil fuel-driven vehicles and with its population projected to double within that period, there will be a huge market for petroleum products. Africa cannot rapidly transit into electric vehicles, as the bulk of the vehicles on our roads today and in the next 20-30 years are going to be non-electric. There is the market, and we should not be discouraged from thinking positively”, the APPO scribe noted.
He disclosed that APPO is working with its Member Countries to construct cross border energy infrastructure like pipelines for crude and products as well as for oil and gas terminals, depots etc.
“Once we have this infrastructure on the ground, the markets for African refiners shall not be limited to their home countries. Fortuitously, the African Continental Free Trade Agreement, which came into force in 2021, is there to support this initiative”, he added.

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Fuel Price Hike: Abdulsalami Warns FG As 36 Governors Plan Urgent Labour Leaders Meeting

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General Abdulsalami Abubakar (Rtd), former Head of State, has warned against increase in the pump price of fuel.
Nigerians are on the verge of paying more for petrol following the recommendation of the National Economic Council (NEC) that pump price should be pegged at N302 per litre.
But speaking at the 19th Daily Trust Dialogue in Abuja, the former Head of State warned against such move.
Meanwhile, Governors of the 36 states of the federation have resolved to engage the Nigeria Labour Congress (NLC) and the Trade Union Congress (TUC) over the proposed N302 new fuel pump price.
Addressing newsmen at the end of their meeting in Abuja, which started on Wednesday night and ended in the early hours of Thursday, Chairman of the Nigeria Governors’ Forum (NGF) and Ekiti State governor, Kayode Fayemi, said the engagement would address the issue without causing disaffection.
Fuel price may rise in weeks as NEC recommends N302 per litre
The National Economic Council (NEC) had recommended an increase in the pump price of fuel to N302 per litre.
Petrol price currently sells between N162 and N165 per litre in the country.
This is reportedly part of government’s plan to fully deregulate the prices of Premium Motor Spirit (PMS), and eliminate monthly subsidy payments with provisions to ensure fair competition in the market.
The TUC, however, said it would meet and take a position on the matter on Thursday.
Reacting, Fayemi said, “The governors discussed issues around fuel subsidy removal and concluded to engage the leadership of the Nigeria Labour Cogress (NLC) and Trade Union Congress (TUC) to address the issue without causing any disaffection but with a view to salvaging the Nigerian economy for Nigerian people at the end of the day.
“So, we will be engaging the NLC as sub-national leaders and with a view to ensuring that the outcome of our engagement will also be fair to the national discourse.
“The report is not from the governors. The National Economic Council chaired by the Vice President of Nigeria has been dealing with this issue over time and really, it is not up to sub-national to decide on what happens to fuel price. However, we are critical stakeholders so we contribute to debate on economic council.”
The governors also commended the senate for “accelerating the removal of the contentious clause in the draft electoral bill and hope the House of Representatives will also follow suit so that the revised electoral bill can return to Mr. President for assent.”

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