A firm incorporated in the British Virgin Islands, Process and Industrial Developments Limited, will ask a British court on Friday (today) for the right to seize up to $9bn of Nigerian government assets over an aborted gas project.
The request is part of a long-running saga over a 2010 deal in which the Nigerian government agreed to supply gas to a processing plant in Calabar that P&ID – a little-known firm founded by two Irish businessmen specifically for the project – would build and run, Reuters reported on Thursday.
When the deal failed, P&ID won a $6.6bn award at arbitration, based on what it could have earned during the 20-year agreement.
The company said the total owed had ballooned to $9bn because of interest accrued since 2013.
Nigeria has tried to nullify the award, saying it was not subject to international arbitration but British courts rejected the argument.
P&ID is now asking the Commercial Court in London to convert the arbitration into a judgement, which would allow them to try to seize international assets, according to Reuters.
A source close to President Muhammadu Buhari was quoted by Reuters as saying that the government was fully aware of the matter and the government “is not sleeping”, adding they were optimistic the matter could be resolved in the courts.
There are also proceedings pending at a US District Court in Washington, D.C.
“This is a problem that the Nigerians are not facing up to in any serious way,” said Andrew Stafford, Q.C. of Kobre & Kim LLP, which is representing P&ID.
Experts said it would be difficult for Nigeria to fully extricate itself.
“Under UK legislation, state immunity does not operate to protect a sovereign state where it has entered into an arbitration agreement,” said Simon Sloane, a partner with UK law firm Fieldfisher.
He added that going after state assets following arbitration had become a well-trodden path over the past 15 years and it would be difficult for Nigeria to avoid paying compensation.
While assets that are used for diplomatic purposes – such as the Nigerian High Commission building in central London – were off the table, commercial assets were up for grabs.
In 2008, a UK court ruled that proceeds of oil sales from Chad held in an international account intended to repay World Bank loans were fair game for seizure.
Experts also said that the involvement of a hedge fund, VR Group, which has a stake in P&ID, signaled that it was unlikely to let the issue drop.
Buhari signs AfCFTA agreement at AU Summit
President Muhammadu Buhari in Niamey, Niger Republic, signed the African Continental Free Trade Area (AfCFTA) agreement, making Nigeria the 53rd state on the continent to append its signature to the document.
Reports reaching Area News, indicated that the president signed the agreement at exactly 10.47 am local time
Buhari had delayed in signing the agreement, which entered into force May 30, 2019.
The delay was to give room for extensive consultations with stakeholders, culminating in the submission of the report by the Presidential Committee to Assess Impact and Readiness of Nigeria to join the free trade area.
The committee had recommended that Nigeria should sign the agreement which aims to boost intra-African trade.
In accepting the report as submitted, the President made it clear that Nigerian government would be seeking to include terms that engender the development of policies that promote African production, among other benefits.
President Buhari said: “Africa, therefore, needs not only a trade policy but also a continental manufacturing agenda.
“Our vision for intra-African trade is for the free movement of `made in Africa goods’. That is, goods and services made locally with dominant African content in terms of raw materials and value addition.
“If we allow unbridled imports to continue, it will dominate our trade. The implication of this is that coastal importing nations will prosper while landlocked nations will continue to suffer and depend on aid.’’
The AfCFTA is expected to be the world’s largest free trade area since the formation of the World Trade Organization, with a potential market of 1.2 billion people.
CIFI N20bn loans: Access Bank begins disbursement to creative sector
Access Bank has commenced disbursement of loans to beneficiaries in the entertainment industry, under the Creative Industry Financing Initiative of the Central Bank of Nigeria.
The bank disclosed this during a forum with some stakeholders in the entertainment industry in Lagos on Tuesday.
It said the first tranche of the CIFI loans worth N20bn, would be made easily accessible to the borrowers in the sector.
Bidemi Adeboye of Access Bank said stakeholders in the creative industries such as fashion, Information Technology, movie production, movie distribution, music and software engineering student could access the loans.
When all documentations were completed and the loans approved, the bank would ensure the beneficiaries got the funds within two weeks, he said.
He added, “The CBN wants to create jobs, develop local capacity, preserve foreign exchange and ensure empowerment in the entertainment industry.
“It is more interested in providing infrastructure funding such as film house, equipment, studio, auditorium, which will make it easier for the entertainers to operate at lower cost and be able to make profit.”
He explained that the loan had maximum interest rate of nine per cent per annum and a repayment period of up to 10 years.
According to him, those who would access the loans should come up with business plan or statement; they must be registered and should be doing what had economic benefits.
Chizoma Okoli of Access Bank said that the CIFI loan was introduced by the CBN to support the creative sector.
She said the bank decided to organise the forum with the stakeholders in the entertainment industry, to get more ideas from them on how best they could disburse the funds to them, and the documents they would need.
Music star, Oladapo Oyebanjo, popular known as D’banj, urged the bank to make the loans easily accessible as promised.
He said, “Most times when we apply for loans, it usually takes up to six months for us to get such. This will be a good development if we can access the loans within two weeks.”
Our economy is still fragile, MAN tells Buhari
The Manufacturers Association of Nigeria told President Muhammadu Buhari on Wednesday that the country’s economy remained “fragile”, much as it appreciated his commitment to perform better in his second term in office.
“It is clear that our economy is still fragile,” the President of MAN, Mr Mansur Ahmed, said when the National Council on Manufacturers Association of Nigeria visited Buhari at the Presidential Villa, Abuja.
Ahmed added, “With the Gross Domestic Product at 2.0 per cent and below the population growth rate, the clouds are still threatening and the task of driving the economy upwards is still enormous.
‘‘But, Your Excellency, we are encouraged by the very strong commitment you expressed only last week in your Democracy Day address.
‘‘You did say that in your second term, your administration will do, even more, not only to continue to drive the economy on the path of sustained growth but indeed to create a more inclusive and sustainable economy.”
He commended some of the administration’s policies, including measures introduced on the ease of doing business, “fight against corruption, focus on poverty reduction, job creation and inclusive growth as well as the launch of the Economic Recovery and Growth Plan.”
A statement by the President’s Special Adviser on Media and Publicity, Mr Femi Adesina, said Buhari used the visit to explain why Nigeria had yet to take a decision on the agreement establishing the African Continental Free Trade Area.
Buhari informed the MAN officials that an impact assessment committee set up by the government to guide it properly was working, adding that Nigeria’s decision on AfCFTA would be based on “national interest.”
The statement said, “The Presidential Steering Committee on the AfCFTA Impact and Readiness Assessment Committee was inaugurated on October 22, 2018, with the mandate to assess the extent to which Nigeria was ready to join the agreement, and what the impact of doing so would be.
“The Committee was initially given 12 weeks to conclude its assignment, after holding wide consultations with industry groups and stakeholders, including the MAN.”
The African Union Summit scheduled for July in Niamey, Niger Republic, is expected to address the AfCFTA.
The statement quoted Buhari as saying, ‘‘I don’t think Nigeria has the capacity to effectively supervise and to ensure that our colleagues in AU don’t allow their countries to be used to dump goods on us to the detriment of our young industries and our capacity to utilize foreign exchange for imported goods.”