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China could influence Nigeria’s govt with its loans, says U.S

August 10, 2023
in Business
China could influence Nigeria’s govt with its loans, says U.S
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L – R- Mukhtar Muye, director of Airport Operations, Federal Airports Authority of Nigeria FAAN; Ben Adeyileka, director, Air Peace; Toyin Olajide, Chief Operating Officer, Air Peace; Rush Wang; Zhou Jwn and Xia Liang Ying, representing Chinese Communities in Nigeria during Air Peace inaugural flight ceremony from Lagos to Guangzhou, China at the Murtala Muhammed International Airport, Ikeja, Lagos on Wednesday.

The United States said in a recent Integrated Country Strategies document of the US Department of State that China could influence Nigeria’s government through the loans it provides to the country.

The document was made on April 6, 2022, but was looked at again and updated on June 23, 2023, The PUNCH reported.

According to the document, China gives money for various projects like building roads and bridges in Nigeria. This money is called “sub-prime financing.” This type of money is given to people or countries who can’t get regular loans and has higher interest rates.

The document said that China’s loans could make Nigeria owe more money and give China more influence over Nigeria’s government.

As of March 2023, Nigeria owed China’s Exim Bank $4.34 billion, the report pointed out.

In January 2022, it was reported that a Chinese company called Chinese Civil Engineering Construction Corporation (CCECC) was doing most of Nigeria’s railway projects. These projects were worth over $25.51 billion.

Read also: Niger owes Nigeria N4bn for power supply – NERC

The report said that Chinese money helped this company do the railway projects. But there were other companies working on the Nigerian railway too.

The US document also talked about problems in Nigeria’s political and economic systems.

“Nigeria’s fundamental problem is patronage-based political and economic decision-making, with little to no coordination between relevant ministries and a disempowered civil service that does not sufficiently advise the Federal Government or sustain policy objectives over multiple administrations,” the he document read.

“Political and economic elites lobby for policy decisions that favour their short-term personal interests rather than the longer-term stability and unity of the state.”

It said, in essence, that the country’s way of making decisions was based on people wanting to help themselves in the short term instead of helping the country in the long term.

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