The candidate of the Social Democratic Party (SDP) in the 2023 presidential election, Prince Adewole Adebayo, speaks with SUBAIR MUHAMMED on the litigation involving a Chinese private firm and Ogun State government which led to the seizure of Nigeria’s presidential jets and the implications for the country in the international circles.
WHAT do you think went wrong in the contractual agreement between the Ogun State government and the Chinese firm that led to the seizure of Nigeria’s presidential jet?
Many things actually went wrong in the contractual arrangement between the Chinese firm and the state government. Sometimes, businesses outlive the tenure of the incumbent governor and the successor might not understand the seriousness of the contractual agreement and may decide to terminate it. But internationally, when you engage investors and you sign these contracts, you are not only signing commercial contracts, you are also signing treaties in some situations, and if there is a dispute between the government and the investor, the investor may decide to sue on their own in a regular court, or it may go into arbitration, or state treaty arbitration.
In this case, as a Nigerian doing business in China, there is an agreement internationally which Nigeria and China are signatories to. So, the issue we need to understand is that the dispute is not originally a Federal Government’s obligation; it is an obligation of Ogun State.
But, under public international law, subdivisions, subsidiaries and sub-nationals, are not recognised internationally. So, if a state out of the 36 states in Nigeria has an international obligation, Nigeria will be the one to be held to account. That is where Nigeria is implicated in the matter. We also need to know that it is not a loan; it is not as if Nigeria took a loan and used any of these national assets as collateral. No, it was business that was supposed to be done between the Ogun State government and the Chinese private firm, which has gone to arbitration. The Chinese firm alleged that Ogun State government had breached the contract by stopping them from making progress and they suffered losses and both parties went to arbitration.
The second stage where it went wrong is that when you go to arbitration and the arbitration award is against you, you should try for the sake of your reputation to pay. But, on some occasions, the state entity involved may be advised by the lawyers that the arbitrators made a mistake, mis-conducted themselves and went outside their jurisdiction. So, some of these things may go into litigation and sometimes, it is just a lack of political will to deal with the issue and they are dealing with it casually.
In all of this, what do you think is the worst case scenario for Nigeria in terms of payment in this ongoing case?
The worst case scenario is that Nigeria will get the arbitration award or a portion of it. As lawyers, it is very difficult to second guess, when you are not the one handling the matter. But from my experience, if I’m asked to advise the government, I will tell them to be careful of their commercial reputation, because they are running a neo-liberal government and most of their macroeconomic policies are dependent on attracting foreign direct investments and foreign portfolio investments and in that kind of situation they wouldn’t want to be seen as a tough cookie, difficult people to do business with.
Nigeria has very good lawyers. Nigeria is highly litigious. It didn’t start today; it has been like that for many years. There is a case where Paul Danny of England passed some negative comments about Nigeria on our attitude towards meeting our obligations. So, Nigeria is known to be a tough customer, such that when they owe you, they don’t want to pay as they will argue it to the end.
On many occasions, [Nigeria] got it right, like the case of P&ID. It would have been a disservice to the country to pay all that humongous amount of money without scrutiny. That scrutiny saved the country massive income, saved the country a lot of our wealth and saved millions of people from going into poverty for having to pay 13 billion dollars which we did not have.
But, occasionally, when you also challenge other ones you get into tough situations, but it is an embarrassment that is temporary. I believe that in the next proceeding, these aircraft will be released but that doesn’t mean that releasing the aircraft will extinguish the obligation to pay any judgment debt. No, it means that Nigeria can breathe easy and then can now focus on how to negotiate. So we must have a system whereby we are able to convince the international community that we are a serious people. One state governor should not come and sign only for another governor to cancel the investment. Many Nigerians have lost assets and many international people have lost assets. I have been a victim of it, such that on many occasions you bring investors to the country, they are doing well and being applauded, then the next government comes, whether due to non-attention, or politics, or malice or mischief, then throw the people out and then trouble started.
The Chinese firm is threatening to take the legal battle to other countries like the UK, what is the implication of this for Ogun State and Nigeria, legally speaking?
For Ogun State, Nigeria is the father and is the guarantor. Internationally, nobody knows Ogun State. I don’t think it has any asset internationally that can be exposed. The worst that could happen to Ogun State is that the Attorney-General may insist that he would deduct from the allocation from the FAAC. That is it. But these are pressure tactics; so it doesn’t mean that going to the UK, America and everywhere is going to get you the asset because the laws are very clear.
For Nigeria, it will expose the country as a very tough country to do business with. I have tried to recover from other countries, once you make a little effort here and there, they will call you to negotiate. Nigeria is a very tough customer internationally. I am a lawyer and I’m a Nigerian. I want to be Nigeria’s president; I am loyal and patriotic to the country, but as a professional, if an international business asks me where they should take their business to and I am advising them on Nigeria, I am bound by professional ethics to tell them that Nigeria is a very difficult country and that in the case of litigation, they may not pay you and may make trouble with you. That’s part of what you need to advise them and you don’t want that to be part of your profile.
I am not saying you should not defend the country, but you should make sure that you don’t lose your reputation. But, overall, there is no need to panic. This is what happens regularly. What the judgment creditor is trying to do is to put you under pressure in many countries. They may not recover anything from all those countries, but they are crying for attention; they are saying, please pay attention to us. Remember China is a very strong country and you don’t want to offend a country that is your partner on many fronts.
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