Centenary City Abuja: Foreign investors mull suit against FG over project delay

…May seek N5Obn claims
The last may not have been heard of the proposed Centenary City Project in Abuja initiated by the Federal Government targeted at establishing a monumental city for the remembrance of the 100 years of the country’s amalgamation, sited at the Federal Capital Territory.

The $18.5billion project may soon take a new ugly twist as the foreign investors, led by UAE investors, have likened the project to the usual characteristic of Nigeria economic development and age-long history of defrauding and dissuading foreign investors.

Our correspondent spoke with the representative of some of the investors, who are contemplating taking the Federal Government to the Court of International Arbitration in order to seek redress and refund of its invested capital and return on investment of three years still counting as at the time of this report.

The Daily Times investigation into the three years struggle by foreign investors to have a simple regulatory issue resolved so that the much needed project can start, showed that they have expended over N10billion part payment, but that not much has been done as all efforts have hit the rock.

According to our sources, meeting the government representatives amounted to nothing but empty promises which has infuriated the major foreign investors.

Our source revealed that the country stands to miss huge investment opportunity with the potentials to provide thousands of employment opportunities.

The source, who spoke in confidence, said: “Investors that we represent are from the USA, UK and mostly from the UAE, and the UAE as you know has a huge pool of investment especially through the Sovereign Wealth Funds.

The UAE also has other sovereign wealth funds like the Mubadala and ADIA and they are two of the largest investment funds in the world (the largest fund is in Norway). Abu Dhabi has lots of money and it wishes to invest across the whole world.

“When the situation with Etisalat came, what happened was that the UAE Sovereign Wealth Fund (Mubadala) which has investment in Etisalat, the national carrier of UAE, wrote off over $2billion between these two companies and Etisalat also lost over N2 billion.

So when people come to invest in Nigeria, not just from the UAE or from Middle East or the GCC, the first port of call will be Etisalat and the second port of call will be MUBADLA and the first question will be, you guys were in Nigeria, then tell us your experience.

And of cause, the response is not going to be pleasant, but there are people like us who still believe in Nigeria.

“We believe that the demography of Nigeria with over 180 million people full of young and vibrant minds, full of entrepreneurial people who have the energy to take this country to the next level.

It has happened in China, it is happening in India, it will happen in Nigeria and we are sure that it will certainly happen.

However, when we do come here, they will be faced with the same issue that MUBADLA and Etisalat faced”.

The foreign investors, our source said are worried about the Federal Government’s negative stands in the entire process which started under the past administration.

The source said: “The investors brought in money from the UAE and other parts of the world, to invest in Nigeria. It is a legitimate money, it is investor’s money protected by two international decrees that prevent government from expropriating foreign investment without any reason.

The first is the NIPC decree and the second one is the IBRD of the World Bank convention, which Nigeria has signed multilateral relationship with 150 other nations and this decree was passed in 1967, so it is not something of recent. What this means is that foreign investors are protected and they draw their strength from these decrees”.

Speaking on the urgent need for a solution to appease already disenchanted investors and to avoid legal battle which may affect Nigeria, the source said that whenever foreign investors lose patience,

then obviously, they will fall back on these two legal remedies which means it has gone into legal disagreement with government, if not, with the one in Nigeria which is the NIPC,

then International Centre for the Settlement of Disputes (ICSD) abroad and should the arbitration go in its favour, they will ask the banks who hold money for Nigeria abroad to freeze Nigeria’s account.

He said, “One foreign investor we represent has already invested over N10billion in the Centenary City Project, and has been waiting now for over three years for Federal Government to give clarity on regulation and with three years, if they had just used the bank rate with customer lending of 20 per cent, that is another N6 billion, they will be claiming from Federal Government.

“Our local investors continue to urge us to be patient and we are hoping that they will see the benefit of the project that foreign investors are bringing to Nigeria specifically to create about 150,000 jobs for Nigerian youths.

And because of how we have been treated by the Federal Government, initially we had 30 employees in our payroll who were being paid in foreign currency but now they have been reduced to just 11 and I am the only foreigner among them, others are Nigerians.

So 19 people were earning money for the economy before but now they lost their jobs. Who Will this development hurt? It hurts those who lost their jobs and to a larger extent the country because it affect the growth of economy.”

On the value of the entire contract, the source revealed that the total investment in Centenary City, stood at the cost of $18.5 billion with N10 billion already gone in the project as part payment and the interest rate would be claimed at the international court should the government refuse to let go of the project.

On seeking redress, the source said: “As far as international investment policy is concerned, we will not wait much longer, because in terms of investment, the interest rate starts counting the day the agreement was signed and we have spent three years after ours were signed.

Our board had asked us several times, for example, you have invested N10 billion, now where is the return and if there is no return, we will not continue because the investment accrues in capital and at some stage, the board will liken our investment to that of the Etisalat and MUBADALA experience in Nigeria and they will soon ask us to close shop and sack everybody and we seek something else”.

“In furtherance to claims envisaged by the investors, there could be much claims emanating from other damages that may have accrued from the delayed project and in legal terms in breach of contract.

“We also may make claims of the loss of our image and brand, we brought in our brand and the brand has been damaged. First, the government has alleged nothing and it is a tarnished brand.

There has been other issues amounting to personal assault meted to our officials who have suffered in the hands of the anti-graft agencies.

For example, our staff severally had been threatened with EFCC, and sometimes it looks like we are not doing genuine business but if the government has the confidence to claim that we have done something wrong, then they should drag us to court and prosecute us.

“As I said before, our staff have suffered molestation numberless times but nothing was found wrong or fishy in the Centenary City Project.

There has been calls for independent probe of the National Assembly committees, already taken place as well as other notable legal means yet nothing was found wrong, so they should be able to make things clear.”

On whether the investors had perceived any discrepancy on the side of government agencies in charge of free trade zones across the country, the source said that the investors were in compliance with all due diligence as far as the Centenary City Project is concerned, saying that they did everything legally possible to ensure doing genuine business in Nigeria.

“I must let you know that our board establishes legal companies all over the world with legal consultants. As a well-known foreign investor, we do background checks before signing contracts and joint ventures.

And our funds employ due diligence before delving in any project and that was what we did here but immediately we had a change in government, everything changed for the worst,” he added.

Counting his ordeal in investing in Nigeria, the source further observed: “I will never regret coming to Nigeria because I saw the potential. Nigeria has the potential even though there is the delay, we will see the return on capital.

I have been in Nigeria since 1993 and none of my board members have come to Nigeria and I am sure MUBADALA regrets it and I’m sure Etisalat regrets it too”.

He said that apart from none commencement of the project, staying in Nigeria has been peaceful. He stressed that there has not been any attempt to stop his movement around Nigeria or any security threat but “the only regret is that we have not been moving forward and we have held meetings with the Government, with several assurances yet nothing has happened”.

On allegations of kickbacks, the source said: “May be such do exist but we are people who believe in due diligence which we also believe had taken effect before signing the contracts and we also believed that all the agencies involved are satisfied of our coming.

You have the agencies on due process as far as this project is concerned. In this case, you have the NEPZA, whose primary duty is to regulate the free trade zones.

It also has certified our agreements and we are working in line with the free trade zone policy of the Government so our offence is not yet known.

So whatever they told us to do, we have done and we are surprised that the other person whomsoever is behind the delay should bring such to the dance floor, we are waiting to see when the music starts.

My life is not under threat; every morning I jog on the streets of Nigeria and I do not go to the gym and am not threatened. But my contract with Nigeria is threatened”.

“In measuring both the past and present administration over the appointment of NEPZA leadership, the source maintained that the leadership in either administration has followed the NEPZA Act and the rule of law, but may have its hands tied due to alleged ‘order from above.’

“I know that the regulatory agencies are under The Presidency, the FCTA which is an extension of the Presidency, the FCDA, and I can tell you that they cannot function alone, they can only do what they are asked to do and do not forget that there are other agencies they work with like the Police, the EFCC and ICPC.”

But attempts by The Daily Times to seek clarifications on the reason for the delay of the Centenary City Project, met with stiff challenge as no reply was given to an official letter requesting for an interview to that regard from the FCT minister, Mallam Muhammad Bello.

Investigation into the matter by The Daily Times further indicates that several panels of inquiry set by the present administration to ascertain the authenticity of the project has yielded no negative result as indication emerged that the free trade zone declaration followed due process by the past administration, before being gazetted.

One of such findings, according to our correspondent, includes the one conducted by the Minister of Justice and Attorney General of the Federation and Minister of Justice, Abubakar Malami, SAN.

The Malami report revealed that the previous administration met all requirements in establishing a free trade zone and duly gazetted the establishment of the law of the Federal Republic of Nigeria.

Furthermore, several efforts by the anti-graft agencies had also proven that the invitation of the former Secretary to the Government of the Federation (SGF), Senator Anyim Pius Anyim, did not show any illegality regarding the contracts or equity sharing.

Our source added that the team of foreign investors through its representative are ready to explore every available opportunity within the local and international means to seek redress.