Finance, Politics
THE ECOWAS Court of Justice has ordered the government of Nigeria’s Cross River State, CRSG, to repay the sum of USD6, 455,846 and an interest of 6.5% per annul starting from 31st August, 2018 to the ECOWAS Bank for Investment and Development, EBID, being the amount outstanding from a loan granted the government in 2005.
Delivering judgment on Friday, 5th February 2021 in a suit brought by the bank, a financial institution and arm of ECOWAS, Justice Edward Amoako Asante, who delivered the judgment, said the “sum represents the situation of the Tinapa Free Zone Project loan in the applicants book as at 31st August 2018.
He asked the Government of Cross River to submit to the Court within two months a report on its measures to implement the Court’s orders relating to the loan with which the government financed the Tinapa business resort.
Although the Court granted most of the reliefs sought by the Applicant, it declined the Applicant’s claim for immediate execution of the Irrevocable Standing Payment Order, ISPO, a loan condition precedent mandating the Accountant General of the Federal Republic of Nigeria tagged “Guarantee” in Clause 7.05 of the loan agreement to satisfy the indebtedness.
The Court also refused to grant the Applicant’s claim for solicitor’s fees on the ground that it was not backed by documentary evidence.
The Applicant EBID had filed suit No. ECW/CCJ/APP/14/19 on 2nd April, 2019, urging the Court to declare its Loan Agreement No. 7/AP/LAR/FRDF/04/05 with CRSG as valid, binding and subsisting between the parties; declare the Respondent as having failed to fulfil a loan condition precedent and compel the Respondent to repay the loan with interest.
The Applicant had alleged that despite several demands, the Respondent refused and or neglected to repay the loan with duration period of seven years after a two-year moratorium.
The Respondent, Government of the Cross River State of the Federal Republic of Nigeria admitted it approached EBID an investment and development bank to part finance its TINAPA business and resort project located near its Calabar Free Trade Zone, and that both parties signed a loan agreement on 20th May 2005 for a sum of UA6, 525,371 equivalent of USD10, 000,000.
The Respondent claimed it made repayments until 2010 when it defaulted due to an administrative issue and that the repayment schedule for the outstanding payment of UA5, 692,376 was restructured to run from 7 January 2010 to 1 January 2020.
The Responded added that it paid installments totaling UA3, 277,080 by 1 January 2014.But the Court noted that the Respondent defaulted on its repayment schedules.Also on the panel for the suit were Justices Gberi-Be Ouattara and Januaria Moreira Costa.
– Feb. 6, 2021 @ 12:15 GMT
Tags: 455 846 USD with interest to ECOWAS bank loan default Cross River State ordered to repay 6
