Politics And Reconstruction of Tin Can Port (3)

The point was made earlier how the NPA boss, Bello-Koko announced having listed a number of multilateral financial institutions for discussion with the funding of the reconstruction of the nation’s failed ports infrastructure.

The institutions included the French Development Agency (AFD) African Development Bank (AfDB), European Investment Bank (EIB), and Sanlam Infraworks (a Central Bank of Nigeria approved fund manager for InfraCorp); through which the authority desire to access long term low-interest credit for the ports infrastructure upgrades and expansion.

But early last month, there was a sudden reverse with reports that Afrexim Bank which was not part of those having discussion with NPA has been awarded the job.

Perhaps, the single biggest obstacle to engaging the right project financier for the Tin Can Island ports and others, in terms of capability to deliver within the set time frame, in addition to competitive and efficient interest administration, is political interference, borne out of infatuation.

It is not for nothing that NPA suddenly changed gear and decided to damn all the prospective lenders it has been discussing with. What is as clear as daylight is that Afrexim Bank never featured in all the discussions until the name dropped suddenly from the sky like a detached thunder bolt.

According to credible insiders’ information, the presidency soon after playing host to the management of Afrexim Bank overruled NPA executive management on the process and directed it to list Afrexim as the sole project financier.

President Muhammadu Buhari according to authoritative sources ordered the change. In his characteristic personality somersault, he was said to have dashed the financial export-import bank the contract on a note of political pleasure while expressing his gratitude to the bank management who paid him a courtesy visit.

It was further revealed that the president directed the Minister of Transportation and the NPA Executive Management to begin the process immediately. Those whose business it is to know further disclosed that Afrexim Bank didn’t just walk away from Aso Rock with the NPA project financing contract but inclusive of critical contracts of several other MDAs.

According to one source, “The management of AFRIEXIMB went to see the President and he told them to fund critical projects in Nigeria. One of the Ministers directed was that of Transportation. All parastatals were directed to identify projects that needed funding.

“NPA identified port renewal projects in Lagos, Warri, Calabar and Onne and proposed that the loan would be accessed through them.”

The source also disclosed that the NPA actual loan facility is just $500million plus, as against the $800million being presently bandied around which has also created its own confusion. More revelation show that NPA accepted to provide 20% of the overall project cost, while the loan facility is wholly tied to the identified ports.

“The condition of AFRIEXIMB is that NPA should provide 20% of the cost while the loan will be 80%. So, the loan is actually 500+ million USD, not 800, and it is tied to projects in the above mentioned ports.

In all, projects tied to the loan facility include the reconstruction of the Escravos Breakwaters which started collapsing since 1984 and dredging of the channel,  the Julius Berger Terminal Warri which has since collapsed;  ENL Terminals 1 and 2 at Apapa port, and the Tin Can Island quay aprons, some of which has also virtually given way as aforementioned.

Another insider source which confirmed the presidential directive however justified the Villa’s decision to patronize the Africa Export-Import Bank, noting it was high time Nigeria look inwards in terms of quests for local project financing as against the practice of foreign loans.

He lamented that if NPA has started addressing the maintenances in question at the right time with available local loans, the infrastructural decay wouldn’t have being as embarrassing as they stand; even as he shrugged off the question of the capacity of Afrexim Bank to handle the proposed budget in a cost efficient and timely manner.

“NPA explored many options chief of which is reconstruction by the concessionaires with the cost being amortised overtime, but because the cost was prohibitive which included the cost of finance, it was dumped.  The first time NPA collected loan was in 2006 when we collected N16billion from Oceanic Bank to rebuild the collapsed Lagos Harbour moles.

“Sadly we prefer foreign loans… that’s our nature, we have this tendency of going for anything foreign over and above ours, even with proven quality. That is why l am not so averse to the presidential directive to go with Afrexim, l understand how it feels that they were never in the picture, but l like the idea that we are looking inward. Nigeria is also a shareholder in AFRIEXIMB.”

Perhaps, this political pollvault granted Afrexim may have been responsible for its recent tough talks in respect of national and regional capacity developments; despite that it is tied to the apron of international development partners to evn be able to meet its primary mandate of financing African exports and imports.

It is only a matter of time before the will bubble burst, the Nigerian Ports capital project financing thrown on its lap by our own Idi Amin, will be the litmus test.