The Debt Management Office (DMO) clarified that China’s loans to Nigeria, which currently stand at $ 3.59 billion, represent only 9.4% of the country’s total external debt stock. of $ 37.9 billion.
Ms. Patience Oniha, the Managing Director of DMO made this known in an interview with the Nigeria News Agency (NAN) on Saturday in Abuja.
She also clarified that the loans were largely concessional, as no domestic assets were labeled as collateral.
NAN reports that in recent times, social and mainstream media have been inundated with information about some African countries, including Nigeria, threatened with losing some critical national assets to the Asian country due to high indebtedness.
“Nigeria’s total debt outstanding as of September 30 was $ 37.9 billion, this figure included the external debt outstanding of the federal government, 36 state governments and the Federal Capital Territory.
“But China’s total loans stand at $ 3.59 billion, or 9.47 percent of total foreign debt. The loans did not require any national assets as collateral; they were largely concessional, ” she said.
Oniha urged Nigerians to always make an effort to verify sensitive information from official sources before releasing it.
She explained that before foreign loans were taken out, multiple government institutions had taken very delicate steps to ensure that they were beneficial to the nation.
“Before contracting any foreign loan, including the issuance of Eurobonds, they are approved by the Federal Executive Council and subsequently by the National Assembly.
“An important and extremely critical step is for the loan agreements to be approved by the Federal Ministry of Justice.
“An opinion is issued by the Attorney General of the Federation and the Minister of Justice before the signing of the agreements.
“Several measures that work in a transparent manner have been put in place to ensure that debt data is available and that the debt is serviced as it falls due. Provisions are explicitly made for debt servicing in annual budgets, ” she said.
Oniha explained that the loan agreements provide for a number of steps to be taken to resolve disputes when they arise.
“The first action is that the parties have to resolve it on their own and if that fails, they go to arbitration.
“In other words, a lender, in this case China, wouldn’t just pounce on an asset at the first sign of a dispute, including defaults,” she said.
She explained that the DMO kept proper debt records, provided projections for debt service, and processed actual payments for debt service.
She pointed out that these functions were carried out in collaboration with the Office of the General Accountant of the Federation (OAGF) and the Central Bank of Nigeria (CBN).