US Raises Concerns Over China’s Potential Influence on Nigeria through Loans: Integrated Country Strategies Document Reveals Worries

The United States has expressed apprehensions regarding China’s potential to exert influence over the Nigerian government by leveraging Chinese loans.

These revelations emerged from the Integrated Country Strategies document prepared by the US Department of State, highlighting concerns about China’s role in Nigeria. The document, initially approved on April 6, 2022, underwent review and updates on June 23, 2023.

In the document, China’s provision of sub-prime financing for various infrastructure projects within Nigeria was underscored. Sub-prime financing involves offering loans to individuals at interest rates higher than prime, targeting those who don’t qualify for conventional loans.

The document voiced concerns about the implications of China’s involvement, noting that “China offers sub-prime financing for a range of infrastructure projects, with the potential to add unnecessarily to Nigeria’s debt burden and increase Chinese influence over the Nigerian government.”

Reports suggest that Nigeria’s debt to the Exim Bank of China reached $4.34 billion as of March 2023.

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Previous reports have indicated significant Chinese involvement in Nigeria’s railway projects. The Chinese Civil Engineering Construction Corporation (CCECC) emerged as a major player, with projects totaling over $25.51 billion. The US document highlighted CCECC’s dominance, supported by Chinese financing, in Nigeria’s railway sector. Notable projects included the Lagos-Calabar coastal railway project spanning 1402km and valued at $11.10 billion, as well as the $3.90 billion Abuja-Itakpe-Warri rail line project.

The Integrated Country Strategies document also critiqued Nigeria’s political and economic system. It pointed to a patronage-based decision-making process, fragmented coordination among ministries, and a weakened civil service. The document suggested that these factors undermine policy sustainability and unity across different administrations. The US further criticized the prioritization of short-term personal interests over the long-term stability and unity of the state by political and economic elites.