[OPINION] How Peter Obi Lied On His N75bn Handover To Willie Obiano

By Obinna Manafa

Obi did not leave any N75bn for Obiano; he failed to pay contractors he used and left N127bn debt for Obiano to pay. He rather saved about N35bn meant for paying his contractors, robbing Peter to pay Paul…..

On 17 March 2014, Obi handed over the mantle of leadership of Anambra state to Obiano who he campaigned for and convinced Ndi Anambra to vote for in the November 2013 elections. He also set up a handover committee which deliberated on his handover note. Obi was an APGA governor and so is Obiano and so the transition was reasonably professionally done.


About three months after handover Obi decided to commence a campaign to tarnish the image of the newly installed governor. His pronouncements were a shock to all and called for a lot of tact from Obiano given that Obi was not only his predecessor but was also from same party and indeed he campaigned for Obiano. All efforts to mend the relationship and make it remain cordial have failed. One truly wonders why he would do that except for the refusal of Obiano to throw the state into further debt by releasing the N7.5bn demanded by Obi as his refund for the campaign expenses which brought Obiano into the government house. He has continued to present a series of lies to the nation on the matter of Obiano and his own leadership of the state. As we go into the election season in the state, it is important that the truth is told on all his claims. This will enable the electorate avoid falling for his lies and from making any errors on the election day.

Today we focus on the case of the ₦75bn naira which Obi claims to have left for Obiano to apply in running state affairs.

THIS IS A LIE DESIGNED TO DECEIVE THE ELECTORATE AND THE NATION AT LARGE. THE TRUTH IS AS FOLLOWS

1. OBI LEFT LIABILITIES IN EXCESS OF ₦127BN FOR OBIANO TO SETTLE. A key part of the campaign was what the party called the 4Cs. One of the Cs is continuity and another is completion, while the last is Commencement. In other words Obi had committed that Obiano will continue his projects and complete them. In line with this Obi left 101 roads uncompleted, left several power projects uncompleted, left various hotels uncompleted etc. If we use just these three classes of projects, we will find that Obi left net liabilities of well over ₦100BN.


a. Road work worth over ₦127bn was left (Originally ₦185bn and he had paid ₦58bn); made up of 101 roads of which Obiano has completed 51 in 3.5 years and progressed to between 60 and 75% on the balance 50 roads.

b. Hotels , shopping malls and power projects Obi started but failed to complete have gulped an additional ₦5bn from the current administration in the spirit of continuity

List of investments handed over totalling N75bn (largely non-cash and some are investments older than Obi)

A. LOCAL CURRENCY INVESTMENTS

I. Nigeria Independent Power Projects (N9.0bn)
Comments:
This program was conceived in 2004 by the Obasanjo administration. The Federation account was charged to fund this initiative.
This is an Involuntary investment with no individual consent whatsoever required from Anambra State Government.

II. Orient Petroleum Resources Plc (N4.0bn)
Comment:
Land resources of Anambra State Government, valued at approximately ₦2.23bn and cash investment of ₦1.77bn.
Specifically, H.E., Dr. Chris Ngige invested N100m and issued C of O for land acquisitions. H.E., Virgy Etiaba invested N1.17bn while H.E., Peter Obi disbursed ₦750m and converted the above-mentioned land into shareholding in Orient Petroleum Plc.


III. Onitsha Hotel, Onitsha (₦1.0bn)
Comment:
N1.0bn was paid to the contractor on this project by the past administration as at handover in March 2014.
The current administration concessioned the project to a reputable real estate development company, Cardinal Developers. The company will complete the Hotel, build a 2,000-seater convention centre and luxury apartment estates. Current economic realities and the naira devaluation have heavily impeded progress on this development.

IV. Agulu Lake Hotel, Agulu (N1.0bn)
Comment:
N1.0bn was paid to the contractor on this project by the past administration as at handover in March 2014.
The current administration has settled certificates totalling N2.55bn till date on this project. We have also secured a partnership with a world class operator, Golden Tulip to manage the operations of the hotel. The hotel is scheduled to open for business in November 2017 (later this year).

V. Awka Shopping Mall, Awka (N0.9bn)
Comment:
N0.9bn was paid to the contractor on this project by the past administration as at handover in March 2014.
About N1.0bn in contract certificates has been settled by the current administration till date. Project design was also amended to include a cinema in the shopping mall. The State, while finalizing agreements with Genesis Deluxe Cinemas and Spar to serve as anchor tenants, we are exploring PPP options to complete the mall and manage its operations.

VI. Nnewi Shopping Mall, Nnewi (N0.6bn)
Comment:
Amount paid to contractor as initial mobilization for shopping mall construction.
About N860m in contract certificates have been settled by the current administration till date. The State is finalizing agreements with Spar and Dubai-based entertainment companies to serve as anchor tenants while simultaneously exploring PPP options for completion and management of its operations.

VII. Onitsha Shopping Mall, Onitsha (N1.0bn)
Comment:
It is pertinent to note that Africa Capital Alliance is the financial investor on this project.


The previous administration contributed the former Anambra Broadcasting Service land to the project’s special purpose vehicle in exchange for a 25% equity stake. No actual cash was invested by Anambra State in this project.

VIII. Intafact Beverages Limited (N3.5bn)
Comment:
To date, Anambra State has invested N1.9bn in the company. The last administration invested about N1.4bn.

While the current administration invested N540m as part of a rights issue exercise to finance expansion plans in April 2014. No further investments were made by Anambra State Government in Intafact Breweries. This figure is a discrepancy and should be revised to N1.97bn.

IX. Onitsha Business Park I (N300m)
Comment:
During the last administration, ANSG via the Ministry of Industry, Trade & Commerce built a commercial real estate development in Onitsha at a cost of N300m.

X. Onitsha Business Park II (N300m)
Comment:
During the last administration, ANSG via the Ministry of Industry, Trade & Commerce awarded a contract to build another commercial real estate development in Onitsha at a cost of N300m. This project has been completed during the current administration.

XI. Anambra State Independent Power Generating Company Limited (N250m)
Comment:
The sum of N250m was paid to the project developers, Denca Resources to serve as ANSG’s investment in a proposed 400MW project in Ogbaru, Anambra State.

After numerous attempts to engage representatives of Denca Resources, the Company eventually honoured the State’s invitation to the Executive Council briefing. The project is under review by ANSIPPA and its execution is currently experiencing significant delays as a result of the slowdown in the economy.

XII. E-Force Limited (₦126m)
Comment:
During the last administration, ANSG via the Ministry of Agriculture paid N126m to E-Force Limited. This sum represents 20% of the cost of 100 tractors from Belarus. E-force Limited provided remainder 80%.


XIII. Emenite Limited (₦750m)
Comment:
Emenite Limited is a leading manufacturer of fibre cement roofing and ceiling products. Dr. The Hon. M. I. Okpara, erstwhile Premier of the Eastern Nigeria, invested in Emenite Limited in October 1961. In 1993, during the creation of States in Nigeria, 16.5% equity stake was allocated to Abia, Anambra, Enugu and Imo states.
No additional monies were invested by the subsequent administrations.

XIV. Quoted Investments Portfolio (N350m)
Comment:
Current value of the equity portfolio is approximately N300m given the current decline in stock prices on the Nigerian Stock Exchange.

XV. NSIA Anambra State Contribution [State + Local Govt] - N1.5bn
Comment:
This program was conceived in 2010 by the Musa Yar’adua administration. The Excess crude account (which forms part of the Federation A/c) converted into the Nigerian Sovereign Wealth Fund. The Federal, all 36 States & 774 Local governments are shareholders of the NSIA.

This is an Involuntary investment with no individual consent whatsoever required from the State.

XVI. Investment with Bank of Industry to Support SMEs in Anambra State (₦500m)
Comment:
Counterpart funds (with BOI) for SME facility. Ministry of Industry, Trade & Commerce.
This is NOT an Investment.

XVII. Investment to Support Micro Credit Bank in Anambra State (₦500m)
Comment:
Counterpart funds (with BOI) for SME facility. Ministry of Industry, Trade & Commerce.
This is NOT an Investment and has 0% chance of recovery given the disbursement structure and criteria.

XVIII. Investment with Bank of Agriculture to Support credit to Anambra Farmers (₦480m)
Comment:
Counterpart funds (with BOA) for Anambra Farmers facility via the Ministry of Agriculture.
This is NOT an Investment.

XIX. Commercial Agriculture Scheme (₦1.0bn)
Comment:
Funds borrowed from the Federal Government for on-lending to farmers in the State via the Ministry of Agriculture and All Farmers Association of Nigeria (ALFAN), Anambra Chapter.
This is NOT an Investment and has 0% chance of recovery given the disbursement structure and criteria.
SUB-TOTAL (I - XIX): ₦27.0bn


B. Foreign Currency Investments - US$155m (₦26.5bn)
Comment:
During the final months of the last administration, the State invested a total of US$155m (N26.5bn) in Eurobonds and other foreign denominated securities held with Access Bank, Fidelity Bank and Diamond Bank. Given the loss in market value incurred between 2014-2015, the current administration appointed a reputable investment banking firm, Afrinvest West Africa Limited, to professionally manage the entire investment portfolio.

The State has liquidated securities worth approximately ₦10bn to settle certificates arising from inherited projects from the past administration.

C. FGN Approved Refund (₦10.0bn)
Comment:
This sum represents ‘Approved Refunds’ by Federal Government for State funds spent on Federal-owned roads across the State. Today, the figure certified by the Federal Government amounts to ₦43.8bn incorporating road works done by the previous administration and the Obiano administration.
Extensive discussions are ongoing between the State and the Federal Government regarding full or a phased-out settlement of the ₦43.8bn refunds.

D. Expected Bank Balances as at 31 December 2013 (₦11.5bn)
Comment:
December 2013 balance. However, the State’s cash balance in March 2014 (upon handover) was approx. N9.0bn.
GRAND TOTAL LOCAL & FOREIGN INVESTMENTS, REFUNDS & BANK BALANCES (N75.0bn)

THE 75BN CLAIM IS A MONUMENTAL DECEIT BY THE IMMEDIATE PAST GOVERNOR OF THE STATE. AS CAN BE SEEN IN THE LIST ABOVE, THE SO-CALLED CASH LEFT BY OBI ARE IN INVESTMENTS MADE IN SHARES, HOTEL PROJECTS, SHOPPING MALLS ETC. How can these be cash Obi left for Obiano. Is Obiano to sell them and use for projects and state activities? Obi needs to explain how these qualify as cash. Some of the items that were termed investments were counterpart funding for donor agency projects such as Counterpart funds (with BOI) for SME facility. Ministry of Industry, Trade & Commerce. Worse is that some of the items were investments made when Obi was either not born or was in nursery school. For example, investment in Emenite which the then premier of Eastern Nigeria made. Obi obviously made such a claim which he has pronounced in every forum he has gone to speak at, to deceive the people.

2. The last part is the issue of 155m dollars bond. On the face of it this appears like a very prudent thing to have done. However, a year after Obi left government, the value of those bonds dropped below the value when it was invested. It would have been best if he made the investment with expert advice, which the current administration has now done to help assure value from the investment. Having said this, Obi handed over more liabilities than this 155m dollar bonds / assets. A look at the balance sheet he left behind will show that he left the state in the red (if we were to ensure that the 4Cs strategy was upheld). Focus on ensuring that we conclude projects handed over, continue some and commence others meant we inherited bills and liabilities. Below is the state’s balance sheet as handed over by Obi. In summary he left the state in the red. We had more debt to pay than the cash or near cash he left behind. Even if we sold all the bonds he left in the banks we will not be able to pay all debt on roads, hotels, shopping malls etc he left behind. Basically, he robbed Peter to pay Paul. He denied contractors their pay to save money in bonds.
Below Table is a comparison of the liability left by Obi and the true value of the investments he left.
Comparison of Liability and True cash value of Assets left by Obi.


A. ASSETS
1. ₦75bn Claim
- True Cash Value: ₦0.0 billion
- Note:  Most of these are illiquid investments and have attracted even more investment from the Obiano administration

2. $155m  bond
- True Cash Value: ₦26.5 billion
- Note:  Lost value within first year of the current administration

3. Cash in Bank
- True Cash Value: ₦9 billion
- Note:  Amount stated in handover note was as at Dec 2013 and had been depleted to ₦9bn by March 2014 when Obiano took over
Total Asset (True Value): ₦0bn + ₦26.5bn + ₦9bn = ₦35.5bn

B. LIABILITIES

1. Road projects unpaid for
- True Cash Value: ₦127 billion
- Note:  101 road projects handed over. Obiano has completed 51

2.  Salaries for 6000 new teachers hired after 2013 elections
- True Cash Value: ₦11 billion
- Note:  Estimate for 3.5 years

3. Hotels, shopping malls & power
- True Cash Value: ₦5 billion
Total Liabilities (True Value): ₦127bn + ₦11bn + ₦5bn = ₦143bn
Net Liabilities (Total Assets – Total Liabilities): ₦35.5 - ₦143bn = - ₦107.5bn

Rather than complain about the huge liability left by the Obi administration, the Obiano administration through a well thought out strategy has found ways of paying the bills by increasing the IGR to meet the liability left by Obi.

Finally, it would appear that Obi’s style of saving and spending own money cost the state a lot. The ability to attract other people’s money is a trait of a great and enterprising leader.

Firstly, Obiano has attracted over 5.5bn dollars of private sector investments while Obi focused on spending our FAAC as he was unable to fashion out ways to grow IGR or show economic viability of the state to discerning private sector investors. Indeed the monies he saved were meant to have been used to pay our contractors or complete projects.

Payment of contractors would inject cash into the state and ensure growth in our economy as it has happened with the current administration. Anambra grew at over 14 percent per annum in the first two years of this administration whereas Nigeria grew at about 6 to 7 percent. Indeed when the country was in recession, the state grew at about 1 percent. This came to pass because Obiano and his team have strategies to grow the economy and this involved a pragmatic mix of spending on economic pillars with the private sector, on enablers aligned to the focus economic pillars and dramatic growth in IGR. Obiano and his team applied an appropriate economic management formula which has worked well for the state. They did more with less and grew our IGR. Where Obi made ₦17bn in IGR in same time, Obiano made over ₦40bn in IGR.

When you check the status of the State, there is indeed no comparison except where white lies are told. For instance, the claim that Obiano abandoned all projects is a white lie. Indeed Obiano spent more on Obi’s projects. Even the Agulu Lake hotel on which Obi was spending our FAAC, has now gulped ₦2.55bn from current administration.

Obi is from Agulu. If Obiano can spend so much on a hotel in Obi’s town, it goes to show he is focused on the good of the state and the 4Cs strategy. He should be applauded rather than lied against.


Obiano’s action is touching every sphere of endeavour and all 9 sectors of the residents in the state. Over the next few days / weeks you will get more details of what he has done for these sectors and what he has in stock for them going forward. You will also get facts about Obi and his claims. This has become necessary so our people are informed!