$6bn Chinese Deal Comes with Proviso: No Dealing With Taiwan!


Olawale Olaleye

Details of the $6 billion dollars investments deal reached with the Chinese Government during President Muhammadu Buhari’s state visit to China last week emerged at the weekend showing that a conditional stipulation that Nigeria must not deal with Taiwan was attached to the deal.

The Peoples Republic of China (PRC) has continued to proclaim the One China policy, insisting it is the sole legal government of China and that Taiwan is a province of China, a development that has made Taiwan, also known as Republic of China (ROC), not to be recognised as a sovereign state by most countries.

Though ROC ceased to be a member of the United Nations in 1971 when it lost its UN seat as China and was replaced by the PRC, as of 2013, the ROC maintained official diplomatic relations with 21 UN member states and the Holy See. It also maintains informal relations with several other UN member states and has offices that conduct its affairs under such names as “Taipei Representative Office” (TRO) or “Taipei Economic and Cultural (Representative) Office” (TECO) in those countries.

A top government official on President Buhari’s entourage to China who disclosed the details to THISDAY said all the deals struck came with that proviso which the Chinese President Xi Jinping specifically emphasised by stating that Nigeria must not deal with anyone claiming to be representing Taiwan because there is only one China and no other sovereignty operates from China under any such guise or nomenclature.

“The President of China however gave a condition and that is, they remain one China. He said there is no Taiwan and nothing of such must be accorded any recognition in Nigeria’s dealing with them. He was very emphatic and you could tell he was not joking and we understood the terms very clearly. No Taiwan, period!,” said the source, who is also a cabinet member.

It was however not a surprise to the Nigerian delegation as it was envisaged in their pre-trip brainstorming session having understood some of the local politics that define China’s international relations, the source said.

Because of its experience with Biafra, Nigeria’s policy right from time had been not to support a divided sovereignty and that a country must always maintain its unity. On the basis of that, it has continued to support one China but with freedom of choice for the component parts to adopt the kind of economic system they deem fit.

During the tenure of Olu Adeniji as Minister of Foreign Affairs under the Olusegun Obasanjo administration, Taiwan took steps to open an office in Abuja (a Trade Office), but the Chinese government protested to the Nigerian government arguing that there cannot be two sovereignties from a state in another country. Nigeria however insisted that if it was a Trade mission, an office could be opened in Lagos as the country’s economic capital, but not in Abuja because international convention requires that sovereign states should establish their offices in the capital cities.

Taiwan however currently puts the address of its representative office in Abuja at 31, Katsina Ala Crescent, Maitama. How the proviso for the $6 billion investments deal will affect Taiwan’s status may begin to unfold soon.

Also, contrary to media reports, the source said there were no new loan agreements with China and that what Buhari did during the visit was to renegotiate the existing loan structure obtained by the administration of former President Goodluck Jonathan.

The cabinet member said, “It is an existing loan obtained by the former administration. It was meant for a counterpart funding project and our government was meant to bring 15 per cent while China provided the remaining 85 per cent of the loan. But Nigeria refused to bring its own equity during Jonathan’s era and was yet spending the money.

“So, part of the essence of this trip was because the president went there to tell them that there was no money and wanted a renegotiation of the loan to suit our current situation. We have not obtained any new loan and whoever is behind the unintelligent rumour can continue to relish in his folly. Theirs is to make noise; ours is to deliver on our promises,” the source said.

Speaking further, the source noted that the biggest achievement of last week’s investment drive to China was the “blank cheque offer” granted by President Jinping, in which Nigeria was given the freedom to ask for anything anytime outside of the already agreed terms and deals.

Another area of the bi-national discussion which the THISDAY source said excited the Buhari team was President Jinping’s advice to his Nigerian counterpart on food security. He was said to have advised Buhari to take the issue of agriculture seriously and that he would be willing to assist where necessary as well as provide all the supports that would enable the country pull through in that critical sector of the economy.

“He said they (Chinese) had experienced poverty before and understands what it is with nations still struggling. For instance, he said China’s population is 1.2 billion and is therefore open to food supply from anywhere in the world. But beyond that, they are not sure which country can sufficiently supply all that they need in terms of food consumption by the time they factor in their own local consumption.

“It was against this backdrop he told us the initiative that drove their huge investment in agriculture with all the modern equipment put into it. He said they were not happy with the situation with some African countries and therefore advised Buhari to see the compelling need to put a lot into agriculture. We got his message very clearly.

“So, the trip was a huge success and we took back a lot from it. But more importantly is that we have been able to create another ally but that friendship or trip has not completely solved our problems. We are the ones to solve our own problems ourselves and we are prepared for it,” he said.

During the visit, several agreements were concluded with the Chinese on key sectors of the Nigerian economy including power, solid minerals, agriculture, housing and rail transportation.

In the power sector, for instance, North South Power Company Limited and Sinohydro Corporation Limited signed an agreement valued at $478 million dollars for the construction of 300 Mega Watts solar power in Shiroro, Niger State.

In the solid minerals sector, Granite and Marble Nigeria Limited and Shanghai Shibang signed an agreement valued at $55 million for the construction and equipping of granite mining plant in Nigeria.

A total of $1 billion will also be invested in the development of a greenfield expressway for Abuja-Ibadan-Lagos under an agreement reached by the Infrastructure Bank and Sinohydro Corporation Limited.

Others include a $250 million deal to develop an ultra modern 27-storey high rise complex and a $2.5 billion agreement for the development of the Lagos Metro Rail Transit Red Line project, a $1 billion facility for the establishment of a Hi-tech industrial park in Ogun-Guangdong Free Trade Zone in Igbesa, Ogun State, a $200million agreement for the construction of two 500MT/day float gas facilities at the Ogun-Guangdong Free Trade Zone and CNG (Nigeria) Investment Limited, and a $363 million deal for the establishment of a comprehensive farm and downstream industrial park in Kogi State.

There were also agreements undergoing negotiations, which include a $500 million project for the provision of television broadcast equipment and a $25 million facility for production of pre-paid smart meters between Mojec International Limited and Microstar Company Limited.