INVESTIGATION: Real reason construction of Abuja-Keffi-Makurdi highway is delayed

Nasarawa State, Nigeria – Hands on hips, elbows turned outward, Oga Godwin watched in horror as a part of his house was pulled down one Thursday morning in Kadarko, a community in Keana Local Government Area of Nasarawa State. Mr Godwin had been given notice that the house he had lived in for eight years would be demolished to make way for the expansion of a federal highway. He was told to leave the property as soon as he received compensation.

Several kilometres away in Benue State, Frido Adodo was lamenting “under-compensation” by the federal government over the same project. His office building at Garba Baba Conglomerate was demolished weeks earlier.

Messrs Godwin and Adodo’s properties were among hundreds of buildings and ancestral lands affected by the dualisation of the Abuja-Keffi-Akwanga-Makurdi highway, a major infrastructure project the federal government is executing to boost social and economic activities in central Nigeria.

The project will cost $542 million with China Harbour Engineering Company (CHEC) handling the road construction while China Exim Bank will provide 85 per cent ($460.8 million) of the funding in the form of Preferential Export Buyer’s Credit (PBC).

Details of the loan show that the PBC contained the following terms: 20-year maturity, a seven-year grace period, and a 2.5 per cent interest rate. The final maturity date of the loan is 21 September 2037.

As of 31 March 2020, Nigeria’s Debt Management Office (DMO) reported that the China Eximbank had disbursed 80.64 per cent of the original face value of the loan.

Chinese loan, contract

In November 2018, the federal government under former President Muhammadu Buhari held a formal groundbreaking ceremony for the expansion and dualisation of the existing carriageway, promising it would ease the suffering of commuters and motorists on the Keffi-Akwanga-Lafia-Makurdi road.

The project involves the expansion of the Abuja-Keffi Road and the dualisation of the Keffi-Akwanga-Lafia-Makurdi axis of the road. The project consists of two parts: the 5.4 km expansion of the Abuja-Keffi expressway, linking Abuja to Nasarawa, and the reconstruction and dualisation of the 221.8 km Keffi-Akwanga-Lafia-Makurdi expressway, linking Nasarawa to Benue.

CHEC is responsible for full implementation including the expansion of the Abuja-Keffi expressway in which a two-lane auxiliary road will be built on the existing six-lane section. The Keffi-Akwanga-Lafia-Makurdi expressway will be widened from two lanes into a two-way, four-lane road.

The construction of the 227 kilometres federal highway began on 1 April 2019 from the southwest of Abuja, crossing the Federal Capital Territory, Nasarawa and Benue.

A month-long investigation by this paper has, however, shown that delays in payment of compensation, land acquisition, and relocation of existing underground utilities have delayed the project.

Compensation

Our investigation involves a review of documents, interviews with residents and tracking of the road across Nasarawa and Benue states.

In an interview published by Businessday, the managing director of CHEC, Zhang Wenfeng, said the process of acquisition of lands has been “very sluggish.” CHEC has executed various projects across different fields in Nigeria, including dredging works in Calabar River, rehabilitation of Terminal B of Warri port, and construction of a breakwater in Lagos.

Although the federal government promised full compensation, residents told PREMIUM TIMES they were “under-compensated and payments were delayed.” At one point, some youths and property owners became violent and threatened to kill construction workers.

The former Minister of Works and Housing, Babatunde Fashola, intervened on the matter. He urged the people affected by the road construction project in Nasarawa and Benue states to embrace dialogue and peaceful engagements towards resolving issues related to compensation rather than violent agitations.

Mr Fashola confirmed that work did not begin in the areas that had issues of resettlement, relocation, and compensation until those issues were resolved, causing further delay in the execution of the project that had a 36-month time frame.

Beneficiaries of the compensations who spoke to this medium said they were not invited for discussion before the payments were processed and many expressed dissatisfaction with the federal government.

Mr Godwin, who is a trader in Kadarko, was not happy with the payment he received in compensation, and the federal government has not offered him more.

“This is not what I expected as compensation,” Mr Godwin said. “It is not enough, but I don’t have anything to do other than to abide by the law,” he said, adding, “I am relocating from this site to a safer place now because I cannot continue to live on the space that’s left of the house.”

“We didn’t get the chance to negotiate; they only paid what they deemed adequate and we have to take it that way,” Mr Godwin added. “We also don’t know what yardstick they used in determining how much we should be compensated.”

Residents refused to state the exact amount they were paid as compensation despite multiple requests by the reporter.

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Some traditional rulers said major concerns remain around compensating community members angered by the “destruction” of their livelihoods due to the road project.

A traditional ruler in Markurdi, the Tor Lobi, Moses Anagende, insisted that the federal government must pay adequate compensation to people that lost “ancestral lands, including farms and houses, to the construction.”

“Recall that at one point, some communities threatened to kidnap the contractors, and I told the federal government that these people should be compensated for the safety of the contractors and engineers on the site. There won’t be any problem once people get compensated,” the monarch told PREMIUM TIMES.

Great job

“But, I think overall, the federal government has done a beautiful job. Those of us who grew up here, we knew how terrible this road was. Travelling from Makurdi to Jos used to take two days at that time but look how beautiful the road is now,” Mr Anagende said.

“The greatest beneficiaries of this road are transporters; those who travel frequently. It’s also positive, security-wise. The criminals can only attack when they know they can escape, but with a good road like this, they cannot organise sporadic attacks and get away with it.”

The Keffi-Akwanga-Lafia-Makurdi road is part of the federal government’s proposed Golden Triangle Loop Plan in 2012, which is centred on the capital Abuja, and connects the port city of Lagos in the south-west, the port city of Port Harcourt in the south-south, and the city of Kano in the north-west.

This national upgraded highway network is expected to strengthen economic and social ties between the major cities and the capital city Abuja, the government said. Authorities believe the completion of Keffi-Makurdi-Enugu will mark the full actualisation of the Golden Triangle Loop Plan.

“The smooth execution of the project is of vital importance to the transportation system of Nigeria,” Mr Wenfeng of CHEC said. “We believe this project is of immense significance to economic and social development alongside the project, the interconnection within the region, and the bilateral trade between China and Nigeria as well as the rest of Africa. Therefore, we will make every effort to ensure the smooth execution of the project while boosting local employment, promoting the economy and fulfilling our social responsibilities.”

Uche Igwe, a Visiting Fellow at Firoz Lalji Institute for Africa at the London School of Economics and Political Science (LSE), told PREMIUM TIMES that the road will potentially be very impactful on the economy of the country and overall on the lives of the ordinary people.

“It is a very important project. If it is being financed by China, that is a very significant investment,” Mr Igwe said.

“If the road is dualised to international standard, it will have very positive implications on food security in the country and of course the sufferings of the poor whose livelihoods depend on the food and transportation of the food,” he added.

The project was expected to be completed in April 2022. However, it has not been completed.

Residents like Mr Adodo, the manager of Garba Baba Conglomerate, said he has continued to complain to the contractors handling the project and government representatives on the issue of his compensation but has been “left unattended.”

“The amount they paid was too small, they ignored all my pleas, and the next thing they came with full force to demolish the structure,” Mr Adodo said. “At first, they agreed to pay more, but they have not. It has been more than six months now and they have not fully paid the money.”

“We are forced to accept what they paid even though it is not commensurate with what they ought to have given,” Mr Adodo noted. “We are talking to one of the Chinese staff, Nane Kator. Unfortunately, we have not gotten anything reasonable from him. It’s the same story.”

Mr Kator, the CHEC staffer, told PREMIUM TIMES that it is not the responsibility of the Chinese company to pay compensation: “The Ministry of Works is in charge of payment. Our work is to wait for the government to pay compensation before we start working in these places.”

Commenting on the project, Mr Kator said there “has been steady progress and over 70 per cent of the road work is completed.”

The Road Sector Development Team (RSDT) under the Ministry of Works did not respond to requests seeking comments for this report.

But some property owners said they are content with what they have been given as compensation. In Daudu, about 12 kilometres from Makurdi, the caretaker of Bentab filling station, who declined to give his name, said he is more interested in what the project brings, not the compensation.

“All I can say concerning the compensation is that it’s good. We have gotten our compensation and I think it’s satisfactory. Most part of the filling station was demolished some weeks ago but the process has been amicable. We have not had any altercation with them and we have reached a reasonable ground,” he said.

“The project is for our own good; more and more people will be patronising us now. It’s an express road without any distortion. We interact with motorists and other people doing business on the road. We welcome this development. They have tried. I am also impressed with the fast pace of the project,” he told PREMIUM TIMES in June.

Chinese loans in Nigeria

China is Nigeria’s biggest creditor with at least $6.5 billion given out for nearly two decades, according to an official disclosure to PREMIUM TIMES following an FOI request.

Nigeria is the sixth-highest recipient of Chinese loans in Africa. With 15 projects financed by Beijing, Chinese debt currently makes up 9.47 per cent of the total debt of Nigeria, which has a debt per capita of $438 per inhabitant according to Dataphyte analysis.

The top Chinese loan-tied projects in Nigeria include power, rail, water and road projects.

Even if it does not take a new loan, Nigeria will still be servicing debts to the Asian power till around 2038, the maturity date for the latest loans obtained in 2018.

Over the last two decades, China has established itself as Africa’s largest bilateral lender, helping bankroll key infrastructure projects on the continent.

Between 2000 and 2020, China lent a total of $159.87 billion to African countries with Angola, Ethiopia, and Zambia topping the list of the countries with the highest amount of loans.

Research by AidData, an international development body at William & Mary University in the United States, showed the interest rate for China’s loans is four times the size of typical loans. But the repayment period is usually 10 years, compared to 28 years for other types of loans and they are focused on long-term infrastructure projects.

The report also showed that Chinese loan contracts contain unusual confidentiality clauses that bar borrowers from revealing the terms or even the existence of the debt, which makes it difficult to track the terms and conditions of the loans given.

Mr Igwe, the political economy analyst, said concerns around Nigeria’s ballooning debt are valid as are issues around transparency of the terms and conditions of the loans.

“Nigeria is heavily indebted at the moment and there are concerns about the implications of this ballooning debt on the political influence of China over Nigeria and Africa as a whole. The desire of ordinary people is that the frequency of these loans is reduced,” Mr Igwe said. “However, the significance of this project is far more important than the concerns we have around ballooning debt. We must continue to develop our infrastructure because Nigeria has been said to be the world capital of poverty. The only way to break from the kind of poverty in the country is to develop infrastructure.”

“Another issue is transparency, in the sense that, if these loans are collected, are they going to be used to fund transformational infrastructure projects? If the answer is yes, then there will be justification for the generation unborn who will be asked to pay this money because some of these loans have long repayment periods,” Mr Igwe said.

“Beyond the fact that there is a need to consider reducing collection of new loans unless it’s absolutely necessary, it’s also important to open up conditionality on the loan. Some of these loans are not well negotiated,” the expert added.

This story was produced with support from the Centre for Journalism Innovation and Development (CJID) and funding from the Centre for International Private Enterprise (CIPE).