News: $1.2bn Etisalat Loan - 4,000 Jobs May Be Lost

The Senate, yesterday, warned that about 4,000 jobs may be lost in the telecommunications industry, unless the relevant government agencies move swiftly to salvage the fallout of the takeover of 9mobile (Etisalat Nigeria), by 13 local banks.

The Red Chamber has therefore called on all relevant financial intelligence agencies of the Federal Government to investigate the management of Etisalat Nigeria and hold the defaulting parties accountable for their actions.

It has equally mandated its committees on Banking, Communications, Capital Market and National Security and Intelligence, to investigate the management and utilisation of the N1.2 billion facility obtained from 13 Nigerian banks.

The joint committee is expected to make recommendations on ways the Nigeria Financial Governance Structure can be strengthened by legislations to prevent similar reoccurrence in the future.

In a motion sponsored by Adeola Olamilekan, titled “The need for Senate’s Intervention in the recent Etisalat Nigeria $1.2 billion debt crisis”, the lawmaker noted that only 42 per cent of the loan facility had been repaid before the takeover.

He added that the outstanding debt of $696 million, representing 58 per cent of its capital, has not been repaid by Etisalat since 2016, long before the takeover.

Olamilekan said: “About 4,000 jobs are at stake as a result of these suspicious dealings. As of 2016, the company had started defaulting on its $1.2 billion loan obligations leading to a few bailouts from its parent company in Abu Dhabi.

“The Nigerian Communications Commission (NCC) and the Central Bank of Nigeria (CBN) had also intervened and raised issues of regulatory compliances in trying to prevent a takeover by the banks, but the intervention failed to produce an agreement on the debt restructuring.

“Although it should ordinarily not be the duty of the Senate of the Federal Republic of Nigeria to wade into individual debt crisis of private sector businesses; the Senate is convinced that if this situation is not properly handled, it will have negative implications for Nigeria Business Environment and on Foreign Investments in general.”

Meanwhile, the Senate has directed its committee on Privatisation to interface with the National Council on Privatisation and the Bureau of Public Enterprises, to receive and examine a comprehensive report of current privatisation status of Nigerian public enterprises.

The committee has also been directed to conduct a public hearing to determine the public enterprises commercialised, current status of privatised enterprises, extent of due process in the conduct of the exercise, enterprises whose privatisation were reversed by the Federal Government, extent of compliance with post privatisation conditions by the core investors and the impact of the exercise on the Nigerian economy.

Lastly, the committee was mandated to come up with recommendations that will ensure functionality of the privatised enterprises to realise the objectives of the exercise which will among others reduce the impact of current economic challenges.

Source: Dailysun