By Kazeem Akintunde
Many Nigerians were aghast when a Chinese company seized three Presidential Jets belonging to the Federal Government of Nigeria in France while on a routine maintenance in their bid to enforcing a court judgment against the Ogun State Government.
Among the three jets seized by the company was a 15-year-old newly purchased Airbus A330-243 with registration number 5N-FGA bought at the cost of $100 million. However, in order for President Bola Tinubu not to miss a scheduled trip to France and take a night bus to Paris, Zhongshan Fucheng Industrial Company Limited, as a measure of goodwill, decided to release the jet to Tinubu for the trip.
Let me quote the company: “As a gesture of goodwill, Zhongshan has lifted the seizure of that particular aircraft immediately. This will allow it to be used for the President’s trip.” True to their word, the aircraft was flown back to Nigeria and within 24 hours, had Tinubu on board for his trip to France!
How low can we sink as a country? The security implication of Tinubu flying the same aircraft 24 hours after it was seized by a foreign company without due diligence by our security agents is a topic for another day.
The two other seized jets, which are part of Nigeria’s presidential air fleet, are a Dassault Falcon 7X with registration number 5N-FGU at Le Bourget airport in Paris, and a Boeing 737 with registration number 5N-FGT.
How did we get to this embarrassing situation in the first instance? Here are the facts: In 2001, China and Nigeria entered a bilateral investment treaty, (BIT) for the “reciprocal promotion and protection of investments” in both countries. The treaty served as the foundation for company investments in the two countries. In 2010, Zhongshan, through its parent company, Zhuhai Zhongfu Industrial Group Co. Ltd, acquired the rights to develop some parts of the Ogun Guangdong Free Trade Zone (OGFTZ) in Ogun state. Gbenga Daniel was the governor of Ogun state during this period. A year later, Zhongshan created Zhonfu International Investment, a Nigerian entity, to manage the project with the permission of the Ogun state government. The company carried out some construction work at the zone.
In 2012, under the administration of Ibikunle Amosun, the Ogun state government appointed Zhonfu as the interim manager of the zone. After a year, the company acquired a majority stake in the OGFTZ. However, things took a different turn in July 2016, when the company accused the state government of abruptly moving to terminate its appointment while attempting to install a new manager for the free trade zone. In 2018, the Chinese firm commenced an investment treaty arbitration under the BIT. The independent arbitral tribunal was chaired by David Neuberger, a former president of the United Kingdom Supreme Court.
In March 2021, the arbitral tribunal ruled that Nigeria was in breach of its obligations under the China-Nigeria BIT and awarded Zhongshan compensation of around $70 million. The tribunal ruled that the sovereign actions of Ogun state, the entity that had the contractual agreement with the Chinese firm, were attributable to Nigeria under international law. Nigeria had argued before the tribunal that Zhongshan’s complaints were not about the conduct of Nigeria, and therefore there is no claim against Nigeria. Nigeria also averred that the tribunal has no jurisdiction to hear the case of the Chinese firms. However, all of Nigeria’s objections were dismissed by the tribunal.
Now, the company is set to recover its money and the only way it can do so is to seize Nigeria’s property in any part of the world and offer such for sale. Already, it has listed the two seized aircraft for sale while two guest houses linked to the Nigerian government in Liverpool, United Kingdom, that were shut down and confiscated by the Chinese company have also been listed for sale on eBay. The properties, identified as 15, Aigburth Hall Road, Liverpool, and Beech Lodge, 49, Calderstones Road, Liverpool, were reportedly worth between £1.3m and £1.7m in June.
Another Private jet belonging to a former Minister, Dan Etete, which was confiscated from him by the Nigerian government has also been seized by the Chinese Company in Canada. The Chinese firm recently received a change of custodian paperwork for the Bombardier 6000 type BD-700-1A10 aircraft from Canadian authorities in Montreal months after a Quebec court issued a judgement that empowered Zhongshang to seize the jet from Nigeria.
With the Chinese company going after Nigeria’s properties all over the world, we are gradually becoming a laughing stock in the international community due to incompetence, greed, and lack of focus on the part of our leaders. Ibikunle Amosun, former Governor of Ogun State, who messed up the whole agreement should be held accountable for the mess Nigeria is in now. A Chartered Accountant by training, Amosun has shown that he is a poor administrator who ruled Ogun State for eight years, taking decision on a whim without consulting any of his colleagues in government.
Amosun is not the only leader that has put Nigeria in a mess with Chinese companies, though his actions and inactions are on the front burner now. Former President Muhammadu Buhari and his Minister of transportation, Rotimi Amaechi, are leaders that would be asked questions in the near future regarding the decisions they took while in power concerning the country’s railway modernisation project. Buhari’s ambitious plans for railway network connecting all the state capitals in the country was a bold move which, however, triggered a floodgate of Chinese money and firms in Nigeria.
By the time he left office, the railway-related loans from China are probably close to $20bn. While in government, Amaechi carried out a detailed assessment of what would be needed to turn the sector around. To modernise the Lagos-Ibadan rail track, Ameachi needed $1.6bn; $5.3bn for Ibadan-Kano route; $3.2bn for Part Harcourt-Maiduguri route and $11.1bn for Lagos-Calabar route.
However, none of this spending comes from Nigeria’s savings; and none from private finance. Rather, it is to China that Nigeria turned for all the money. And China is always willing! Already, it is estimated that there are 17 different Chinese loans that Nigeria has taken to fund different categories of capital projects in the rail sector alone.
American statesman, John Adams, had famously said: “There are two ways to conquer a country. One is by the sword. The other is by debt.” China is believed to have chosen the latter, and Nigeria may have offered itself to that Asian country on a platter. In fact, Nigeria made itself a willing pawn in the Chinese debt-trap diplomacy. What the Chinese did was to ensure that we signed what was termed anti-sovereignty clause in the railway construction contract signed in 2018 by the Federal Ministry of Finance, on behalf of Nigeria, and the Export-Import Bank of China.
In the anti-Sovereignty Clause, Article 8(1) of the contract says that “the borrower (i.e. Nigeria), hereby irrevocably waives any immunity on the grounds of sovereignty or otherwise for itself or its property in connection with any arbitration proceeding pursuant to Article 8(5) thereof with the enforcement of any arbitral award pursuant thereof …”
Although there is nothing unusual about this clause as it’s the kind of the waiver-of-sovereign-immunity clause that exists in any contract between sovereign and private parties, the implication is that if Nigeria cannot pay back the Chinese loans, China can seize Nigerian assets, including assets linked to the Nigeria Railway Corporation. What makes this scarier is that China is aggressive in enforcing such anti-immunity clauses.
A good example was what took place in Sri Lanka. In 2018, when Sri Lanka could not service the loans it took from China to build its Hambantota port, China forced its government to hand over the port and 15,000 acres of land around it to manage and run for 99 years. While in power, the Buhari government said that Nigeria would pay back the Chinese loans in 20 years. But the real question is, how? Railways are only viable through large passenger numbers. The Lagos-Ibadan Railway is presently not generating enough funds for its operations. The Abuja-Kaduna Railway line that should have been the money spinner for the Nigeria Railway Corporation was dealt a major blow when kidnappers riddled the train with bullets few years back and the service was suspended for several months. Although it is back in business, patronage has dropped a bit with improved security on the Abuja-Kaduna Road.
Again, I do not know the number of passengers making use of the Kano-Katsina-Jibiya-Maradi , Niger Republic rail line, which is another poorly thought-out project approved by Buhari simply to link his Fulani brothers in Nigeria with their kith and kin in Niger Republic. While commissioning the project, Buhari described it as ‘’ a testament to our shared history and ambition for economic advancement. It will create a lasting legacy of wealth and opportunities for Nigeria and the Niger Republic’’. I pray so.
With Nigeria’s economy on a downward slope with little or nothing coming to the country through Foreign Direct Investments (FDI), or from the sale of crude oil, how we intend to repay the over $20billion dollar loans back to China remains to be seen. Twenty years would soon crawl on us and we should not be surprised if the Chinese seizes the Aso Villa.
Perhaps the way to go would be to appeal to the Chinese to come and colonise us as the set of leaders that have been in charge since 1960 have proven to be incompetent, greedy and unpatriotic leaders who vie to be in government for what they can get out of the system. Chinese money that we are running after was there because any Chinese national that stole in their country faces the death penalty. But here, we glorify our corrupt leaders while many of we, the followers, wait patiently and pray fervently for our share of the national cake. We don’t plan for tomorrow, believing that tomorrow will take care of itself. Both the leaders and the led in Nigeria are the same. It is only when we have a purposeful leader who is ready to whip everyone in line that we can start to talk about growth and development. For now, we should simply ask the Chinese to come and rule over us instead of stripping our nation of our assets.
See you next week.
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