On July 30, 2020, it was reported that a committee established by the Nigerian House of Representatives to investigate the country’s exposure to Chinese debt had discovered that a $400 million loan provided by the Export-Import Bank of China in 2018 for a telecommunications infrastructure project included a clause under which Nigeria waived sovereign immunity from the enforcement of any future arbitral award. The clause raises concerns about Nigeria’s ability to intervene if China were to seek control of the underlying assets in a default scenario.
Despite these revelations, Nigerian Transport Minister Rotimi Amaechi said that a separate probe into Chinese financing of Nigeria’s railway development should be postponed until December and expressed concern that the investigations could make it difficult for Nigeria to access international project financing.
The investigation is the result of a motion passed by Nigeria’s House of Representatives on May 12, 2020, which established the committee. Part of the committee’s mandate was to explore the possibility of applying force majeure rules to its loans from China, which could allow for some loans to be cancelled. The motion came amidst discontent among Nigerian lawmakers over the non-transparency of Chinese loans and growing calls for Chinese development lenders to provide debt relief as the COVID-19 pandemic raises repayment difficulties.
The Export-Import Bank of China is Nigeria’s largest bilateral creditor, according to Representative Ben Igbakpa, who initiated the motion. Recent estimates suggest that there are at least 17 Chinese loans to fund various projects in the country.