Nigeria Prefers New Chinese Loans Over Debt Forgiveness - Foreign Affairs Minister

Nigeria Snubs Debt Forgiveness, Eyes Additional Funding from China

“As a matter of fact, China is prepared to lend more, China is prepared to invest more in Nigeria in terms...”

Foreign Affairs Minister Yusuf Tuggar reveals China's willingness to enhance financial backing for Nigeria.

Nigeria's Federal Government has made it clear that it's not seeking debt forgiveness from China, despite ongoing discussions about debt relief globally. Foreign Affairs Minister Yusuf Tuggar stated this on a TV program Sunday, September 29, while addressing Nigeria's debt situation and recent China engagements.

Tuggar's statement comes as Nigeria's debt to China grew 136% between September 2015 and September 2020, from $1.4 billion to $3.3 billion. However, Nigeria views China as a key partner, with Chinese investments in industries like transport offering access to capital and expertise for much-needed development.

China's investments in Nigeria are substantial, with 70 construction, 40 investment, and 30 trading Chinese companies operating in the country. Notable projects include the Abuja-Kaduna and Lagos-Ibadan standard gauge rail lines, and new international airport terminals in Abuja, Port Harcourt, and Kano.

Some experts argue that Chinese investments in Africa, including Nigeria, are driven by strategic interests, including access to natural resources, markets, and soft power expansion. While there are concerns about debt distress and economic colonization, others see these investments as mutually beneficial.

“No, that is not what we are discussing with China.

“And when it comes to the issue of debt, look at the debt-to-GDP ratio of Nigeria, we are not even among the critically indebted nations.

“When you talk about the debt of a developing country, Nigeria is not in that sort of precarious situation.

“As a matter of fact, China is prepared to lend more, China is prepared to invest more in Nigeria in terms of infrastructure development and other things,” he said.

Here are some key points about Nigeria's relationship with China:

Nigeria-China Trade: Nigeria sees China as a steady partner and its largest lender, with trade increasing from $1.2 billion in 2003 to $13.7 billion in 2019.

Chinese Investment: China is a major investor in Nigeria, with investments rising from $24.4 million to $123.27 million between 2003 and 2020.

Infrastructure Development: China finances large projects in Nigeria, including railways, road projects, and airport rehabilitation.

Debt Concerns: Nigeria's growing dependence on Chinese loans has raised concerns about transparency, corruption, and the country's ability to repay its debts.

Nigeria's Foreign Affairs Minister, Yusuf Tuggar, has made it clear that while the country is pushing for global debt relief measures, including at the United Nations General Assembly, China is still willing to increase its financial support for Nigeria. This comes as no surprise, given the strong bilateral ties between the two nations. In fact, China has been actively investing in Nigeria's development, with projects such as the Lekki Deep Sea Port, Lagos-Ibadan Railway, and Abuja-Kaduna rail line, showcasing its commitment to Nigeria's growth.

China's support extends beyond infrastructure development, with agreements to enhance military cooperation, promote peace and stability, and strengthen economic ties. The two nations have also explored cooperation opportunities in the digital economy, green economy, and blue economy, with China expressing interest in importing Nigerian agricultural products.

Nigeria's strategic partnership with China has yielded significant benefits, including increased access to capital and expertise for development projects. However, some experts have raised concerns about Nigeria's debt burden and the potential risks associated with Chinese financing.

Despite these concerns, Nigeria's government has welcomed China's support, acknowledging the mutual benefits of their cooperation. As the relationship between the two nations continues to grow, it's clear that China remains a key partner in Nigeria's development journey.