Mr. Obasanjo also explained why he head-hunted Nigeria’s immediate past finance minister, Ngozi Okonjo-Iweala, who also held that role during his administration.
According to Premium Times, he made this known in his new book titled “Making Africa Work”, launched recently in Victoria Island, Lagos.
The book was co-authored by the former president and three others – Greg Mills, Director of Brenthurst Foundation; Jeffrey Herbst, President of NEWSEUM and Dickie Davis, a retired major general.
Mr. Obasanjo governed the nation as a democratically elected leader between 1999 and 2007.
According to the former president, on assumption of office, he realised that some of the projects that constituted Nigeria’s accumulated debt of $30 billion were dubious.
“On assumption of office as president, I discovered that the accumulated debt of Nigeria to the Paris Club was some $30 billion. Some of the projects that constituted the debt were dubious, if not outright fraudulent,” Mr. Obasanjo wrote.
“One typical example was a turn-key project for $8 million where the money was drawn out with no site clearance let alone the foundation being laid. And yet, there was a video of the purported commissioning of the project. This happened in Enugu state, one of the 36 states in Nigeria.
“Obviously, it involved collusion and corruption between the state government and the lender and promoter of the project. All the same, the loan was a commitment and it had to be repaid. Such had become the practice of Nigerian debt to the international community.”
Mr. Obasanjo explained further that he did not waste time on the merit or demerit and impropriety of any of the projects, which previous governments had accepted and on which interests and penalties were already being paid in the event of failure to meet interest payments.
“I concentrated on seeking debt relief from the governments of creditor countries, which have bound themselves together as a cartel in what they called the Paris Club.
“Nigeria was spending almost $3 billion annually to service all its debt. This was a heavy burden on the economy of the country. Yet, a failure to service the debt would incur penalties.
“The most sustainable and prudent course was negotiation. But what sort of negotiation? Previous administrations had negotiated postponement of repayment and servicing terms, which kept increasing the quantum of debt, making it more and more burdensome and unbearable, especially with the price of a barrel of oil below $10 when I assumed office in 1999,” he wrote.
The former president said he embarked on ‘shuttle diplomacy’, to clean up the image and perception of Nigeria in the eyes of the world and to seek debt relief.
“I visited most Western capitals to present anew Nigeria’s case. One such visit was to Washington DC where I met President Clinton and the president of the World Bank, Jim Wolfensohn.
“I raised the issue of debt relief with both of them and asked Jim for both support and advice. He advised that Nigeria should urgently embark on a comprehensive reform to impress its creditors. If Nigeria was doing well in its economic reform and management, it would get the World Bank’s support,” Mr. Obasanjo wrote.
Explaining further, he noted that the advice constituted his marching orders, which led to his decision to headhunt Mrs. Okonjo-Iweala from the World Bank.
“In my first term, from 1999 to 2003, I visited many countries and world leaders, some more than once, to campaign for debt relief. There I got apparently sympathetic hearings, but not much action from political leaders.
“After my first term, I realized that my talks at the highest political levels needed follow-up at the levels below. So, I head-hunted Ngozi Okonjo-Iweala from the World Bank, appointing her as Nigeria’s Minister of Finance.
“My plan was that she would manage the follow-up at a lower level. Even then, the fact that Nigeria was the sixth largest oil-producing country in the world was regularly used as the reason to deny debt relief. I would then explain that Nigeria’s population of almost 150 million at the time and its stage of development should justify such relief.”
The former president described the Paris Club debt relief as a ‘breakthrough’, which he said enabled Nigeria to negotiate debt relief from other creditors.
“In the end, Nigeria obtained debt relief of about $18 billion and paid up about $12 billion to rid itself of this burden. It was a great breakthrough and the consequent savings were channelled to the Millennium Development Goals, one of the promises made to the creditors,” Mr. Obasanjo wrote.
“With debt relief having been agreed by the Paris Club, Nigeria was in a strong position to negotiate debt relief from other creditors too.” PLACE YOUR TEXT ADVERT BELOW:>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> How I Made Me =N=2.5 MILLION In 7Days from 2 Common Product I Imported and how you can do the same. Click HERE FOR FREE Details right now