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Buhari asks Finance Ministry to explain diversion of foreign loans

by Business News Report

President Muhammed Buhari on Monday asked the Ministry of Finance to explain why foreign loans obtained for various key rail projects by the federal government were diverted for other purposes.
Speaking at the end of a presentation on the Ministry of Transport by the Permanent Secretary, Alhaji Mohammed Bashar at the Presidential Villa, President Buhari, according to a statement by Garba Shehu, his Senior Special Assistant on Media and Publicity, said that it was disappointing to find that foreign loans obtained in line with signed agreements were moved from one project to another.
“I hope that due process was followed before such diversions were carried out. Taking money from one project to another has to be done properly,” the President warned.
The statement further said President Buhari was reacting to the specific instance of the diversion of a substantial part of the loan of USD1.005 billion from the Chinese Exim Bank, obtained for the construction of a standard gauge rail line linking Lagos to Kano but which was moved elsewhere.
The loans were obtained from China in 2012 under the President Goodluck Jonathan whilst Dr. Ngozi Okonjo-Iweala served as Minister of Finance and Coordinator of the Economy.

The Permanent Secretary had informed the President that only USD 400 million of that loan remained with the Ministry of Finance.
The President regretted that government had, over the years, failed to meet its counter-part funding obligation on some projects, leading to such projects being left uncompleted or abandoned.
He added that there was a clear need to streamline, harmonize, and prioritize on-going projects in the transportation sector.
The Permanent Secretary of the Ministry also briefed the President on other challenges facing the transport and maritime sectors such as encroachment on railway land, lack of security on inland waterways and the confused nature of agreements between the Nigeria Ports Authority and ports concessionaires.
President Buhari is yet to form his cabinet almost three months after he assumed office as President. He says he needs time to fix and restructure the entire workings of government which had over he years encouraged corruption and wastes.
Buhari has also reiterated that all funds stolen from the state treasury would be recovered by his administration.

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