A former House of Representatives member, Hon. Ned Nwoko, has cautioned the Federal Government on loan negotiations with multinational organisations.
Nwoko gave the warning in Ibadan at the 2019 National Public Service Lecture, organised by the University of Ibadan Alumni Association.
Nwoko, a legal practitioner, represented Aniocha North-South/Oshimili Federal Constituency from 1999 to 2003.
Nwoko, in his lecture entitled, ‘Towards Efficient Management of Nigeria’s Foreign Loans’, stressed the need for proper synergy between departments and officials sourcing, negotiating and securing foreign loans for governments at all levels.
“Nigeria, and indeed developing nations, must exercise caution when negotiating or rescheduling loans with multilateral organisations, like the IMF, that are under perennial remote control of few capitalist superpowers.
“The interests and goals of some of these organisations are often at variance with those of developing countries like Nigeria,” he said.
The former lawmaker urged those in charge of superintending Nigeria’s external loans to develop capacity and define coherent realistic strategies for negotiating the terms of Nigeria’s external debts.
“In avoiding or being cautious over loans with harsh conditionality from powerful Western cartels, Nigeria should equally be wary of the neo-colonialist push of the emerging Eastern superpower, China.
“China’s so-called concessional loans sometimes end up as damning as the coated bitter pills from the Western powers and their groups,” he said.
Nwoko also warned against improper utilisation of foreign loans, saying this was a major factor that could make repayment of such debt a herculean task.
“Once that happens, it becomes extremely difficult, if not impossible, to keep pace with repayment schedule and the accruing interest begins to rise, with repayment becoming a major problem.
“The interest may increase to a level where it may equal or even surpass the initial amount borrowed,” he said.
The former lawmaker posited that most China loan deals were tied to projects, saying recipient countries were often compelled to use materials, consultants and workers provided by the creditor country.
He added that a large chunk of the concessional funds released for the projects were ploughed back to the creditor country.
Nwoko called on Nigerians to be more patriotic by defending the interests of their country, its institutions and economy as well as fellow countrymen and women.
“Situations where our own people collude with foreigners and their institutions to defraud Nigeria and Nigerians cannot augur well for the development of the country.
“Those managing our foreign debts should be on permanent alert to protect the interest the country and prevent corrupt foreigners and their Nigerian collaborators from defrauding the country,” he said.
Nwoko further called for continuity and seamless transitions with regard to management of foreign debts so that policies would continue when government was transferred from one individual or group to another.
“There is the need for continuity in governance anchored on transparent and seamless transitions, especially with regard to management of our foreign debts and other related financial or contract transactions.
“The ideal system should be such that when there is transfer of power, all relevant policies, programmes, decisions and agreements will be appropriately captured and understood.
“At all times, the implications, terms, risks and processes should be taken into account on both short and long term basis,” he said.
He said that the kind of circumstance that led to the recent award of over $9 billion against Nigeria in the aborted gas deal would not have arisen if such process had been adhered to.
The former lawmaker said that the country needed to act fast on ways forward, be it assemblage of a team of experts to negotiate or explore other options considered appropriate.
Earlier, Prof. Elsie Adewoye, President, UI Alumni Association worldwide, commended Nwoko and the institution’s Vice-Chancellor, Prof. Idowu Olayinka, for their usual support for the institution.
Adewoye, who said that some outstanding students would be rewarded, added it was imperative for the association to promote excellence among the students.
The event, which was held at the UI Alumni Association auditorium, featured presentation of awards to students of the institution who had distinguished themselves in their studies.
The event was attended by the vice-chancellor, a former England international, Mr John Fashanu and other prominent Nigerians.
