Socio-Economic Rights and Accountability Project (SERAP) has filed a lawsuit against the government of President Muhammadu Buhari over “secrecy in the spending of loans so far obtained, the unsustainable level of borrowing by the government and the 36 states, debt crisis, and the disproportionately negative impact of these retrogressive measures on poor Nigerians.”
In the suit number ECW/CCJ/APP/05/22 filed last week before the ECOWAS Court of Justice in Abuja, SERAP is seeking: “An order directing and compelling the Federal Government to issue an immediate moratorium on borrowing by itself, and the 36 states, in conformity with the country’s international human rights obligations.”
SERAP is also seeking “an order directing and compelling the Federal Government to publish details of spending of the loans obtained by governments since 1999 including the list of projects and locations of any such projects on which these loans have been spent.”
In the the suit filed by SERAP and behalf of concerned Nigerians, the organization contends that, “Persistent and unsustainable borrowing by the federal and state governments and the crippling debt burden undermine the rights of Nigerians to economic and social development, and are antithetical to the public interest.”
SERAP is arguing that, “The crippling debt burden is a human rights issue within the jurisdiction of the ECOWAS Court because when the entire country is burdened by unsustainable debts, there will be little money left to ensure access of poor and vulnerable Nigerians to legally enforceable socio-economic rights.”
SERAP is also arguing that, “There is lack of transparency and accountability in the spending of the loans so far obtained, and opacity around the terms and conditions in loan agreements, including repayment details for these loans. The details of the projects on which the loans are spent are shrouded in secrecy.”
SERAP is also seeking “an order directing and compelling the Federal Government to conduct assessment of the borrowing by governments since 1999 to address the dire consequences of unsustainable debts on people and communities and to ensure that borrowing at all levels of government considers the human rights impacts.”
In the suit filed by SERAP lawyers Kolawole Oluwadare and Opeyemi Owolabi, the organization contends that, “Long-term unsustainable debt can be a barrier to the government’s ability to mobilize resources for human rights, and may lead to taxes and user fees that impact negatively on vulnerable and marginalized Nigerians.”
The suit, read in part: “If not addressed, the escalating borrowing and looming debt crisis would cripple the ability of both the Federal Government and the 36 states to deliver ensure basic socio-economic rights, such as quality healthcare, education, and clean water of the most vulnerable and marginalized sectors of the population.”
“Without a moratorium on borrowing, the Federal Government and many of the 36 states may be caught in a process driven mostly by creditors’ needs. This will result in an exorbitant social cost for the marginalized and vulnerable sectors of the population.”
“The ability of the Nigerian government to ensure human rights is inextricably related to the ability to spend needed resources. Growing debt burdens and debt repayment difficulties will have negative impacts on the ability of the Defendant to fulfill the basic socio-economic rights of poor and vulnerable Nigerians.”
“Sustainable debt management by the Federal Government and state governments will contribute to mobilizing resources for human rights and essential public services, and promote a culture of responsible borrowing.”
“The Federal Government and many of the 36 states would seem to be in debt distress or at high risk of debt distress. According to reports, the Senate and House of Representatives recently approved the loans of $5,803,364,553.50 and a grant component of $10m under the 2018-2020 External Borrowing (Rolling) Plan of the Federal Government.”
“This followed previous approvals by the National Assembly of $16.2 (16,230,077,718) billion loan; €1 (1,020,000,000) million and a grant component of $125 million loan; $36.8 billion, €910 million loans, and a grant component of $10 million; $8.3 billion and €490 million loans; $6.1 billion, $1.5 billion and 995 million loans; and $4(4,054,476,863), €710 million and grant component of $125 million.”
“Several of the 36 states are also facing a debt crisis, and vicious debt cycles. According to the Debt Management Office, the foreign debt stock of the Federal Government, 36 state governments and the Federal Capital Territory presently stands at $37.9bn.”
“The loans from China alone amount to $3.59bn. According to the UN Independent Expert on foreign debt and human rights, Nigeria faces debt service relative to tax revenues that exceed 20 per cent, with escalating social tensions linked to poverty and inequality.”
“According to the World Bank’s IDA FY21 Report, with debt exposure of $11.7 Billion US Dollars, Nigeria ranked fifth among the top 10 countries with highest debt risk exposure. The top four countries are India with $22 billion, Bangladesh ($18.1 Billion), Pakistan ($16.4 Billion), and Vietnam ($14.1 Billion).”
“While it is critical for the Federal Government and state governments to have adequate resources to fund their budgets, it is equally critical for governments to give consideration to the human rights impact of borrowing. Persistent borrowing is inconsistent with the country’s human rights obligations.”
SERAP is also asking the ECOWAS Court for the following reliefs:
A DECLARATION that the failure of the Defendant to halt the persistent and unsustainable borrowing amounts to a breach of the Plaintiff’s and other Nigerians’ rights to the enjoyment of socio-economic rights, and development, as guaranteed under articles 2, 9, 11, 12 and 13 of the International Covenant on Economic, Social and Cultural Rights, and articles 2, 15, 16, 17, 22 and 24 of the African Charter on Human and Peoples’ Rights.
A DECLARATION that the failure of the Defendant to halt the persistent and unsustainable borrowing amounts to a fundamental breach of Nigeria’s human rights obligations under the International Covenant on Economic, Social and Cultural Rights, and the African Charter on Human and Peoples’ Rights.
AN ORDER directing and compelling the Defendant to adopt and ensure effective measures to address transparency and accountability gaps in spending of loans, and the systemic and widespread corruption in ministries, departments and agencies, as documented by the Office of the Auditor-General of the Federation, including in the 2019 Audited Report.
AN ORDER OF PERPETUAL INJUNCTION restraining the Defendant and its agents from embarking on unsustainable borrowing until the human rights impact assessment of the previous borrowing is conducted and recommendations fully implemented.
SUCH FURTHER orders the Honorable Court may deem fit to make in the circumstances of this suit.
No date has been fixed for the hearing of the suit.