There is no gain repeating the fact that Nigeria is indeed one of the most
\nviable countries to do business in Sub-Saharan Africa. It is also a known
\nfact that the country desires credible foreign investors to explore its
\ngreat potential, of abundant human and natural resources. What I also know
\nhowever is that Nigeria and indeed the present government of change under
\nPresident Muhammadu Buhari will not condone fraud under any guise. This
\nstatement of fact is necessary to lay the basis for my intervention on the
\nbundle of lies being peddled in the media by a Chinese businessman, Dr.
\nJason Han,<\/p>\n
Managing Director of Zhongfu International Investments (Nig.) FZE, whose
\nmanagement engagement was recently terminated by the Ogun State Government
\nin regard of his involvement with the Ogun Guangdong Free Trade Zone,
\nIgbesa.\u00a0 Based on my findings from Ogun Statement and investors in the
\nZone, I shall in this write-up attempt to defend the action taken by the
\nState Government to protect the interest of Nigeria and ensure transparent
\nbusiness transactions, while providing factual details to counter the many
\nlies of Mr Han in an attempt to confuse and mislead the Nigerian public
\nand the Federal Government especially President Buhari.<\/p>\n
After his first lie that foreign investors at the Zone have threatened to
\npull out following his disengagement, was roundly debunked by the same
\ninvestors, Mr Han has now resorted to writing open letters to Mr
\nPresident, this time appealing to emotion and sentiment, with threat as an
\naddendum. Eventhough, he admitted that the Ogun State Government acted
\nbased on the request of the Chinese Government, he never provided the
\ndetails that put a question mark on his credibility.<\/p>\n
He failed to state that Zhongfu could not provide a single fire station or
\na mobile fire fighter machine in the zone for the past four years, even
\nwhen this is mandatory according to NEPZA rules, while claiming to have
\nspent $60m in the Zone.\u00a0 Where did the money go to? They unilaterally
\nincreased service charges and imposed different tariffs on investors
\nwithout consulting the shareholders.\u00a0 This is beside using the name of
\nOgun State Government and other eminent Nigerians to intimidate foreign
\ninvestors in the Zone, moving around with sirens and a retinue of heavily
\narmed policemen meant to protect the people in the Zone, taking expensive
\ngifts round to eminent Nigerians for lobby as if that\u2019s what the Nigerian
\neconomy requires this critical time.<\/p>\n
It is equally appalling that at a time when Nigeria is battling to
\nstabilize its economy, Zhongfu was demanding investors in the Zone to pay
\ncharges and tariffs in dollars or Chinese Yuan against our own local
\ncurrency, thus further putting more pressure on dollar demand in Nigeria.
\nIt is equally disturbing that Zhongfu was using the Zone to secure
\npersonal international loan. Worse still, they failed to provide other
\nbasic amenities such as emergency medical facility\/clinic, motorable
\naccess roads leading to the OGFTZ and within it,<\/p>\n
drainage system within the Zone, office and residential accommodation for
\ngovernment agencies (Customs, Immigration, DSS, Police, NEPZA) within the
\nZone, all of which are still using the containerized office and<\/p>\n
accommodation provided by previous managers of the Zone. It is also worthy
\nof note that Zhongfu promised to make the provision of the above their
\nimmediate<\/p>\n
priority when they were being engaged as managers but such is not the
\nstory today. Not one item on the above was ever done, leaving one to
\nwonder where their so called $60 million was invested. They rather
\npersisted in flouting every law and laid down rules including but not
\nlimited to: increasing tariffs paid by investors without the input and
\napproval of the JVA (Joint Ventures Agreement) partners, forcing investors
\nto pay tariffs in foreign exchange (US dollars and<\/p>\n
Chinese Yuan) without the input and approval of the JVA partners, refusing
\nto provide audited accounts for the four years they operated in the OGFTZ
\ninspite of repeated demands by the JVA partners, failing to compensate the
\nindigenes of Igbesa for their land and crops on their farmlands. Also
\npertinent is the fact that the Zhongfu executives were found of staying
\naway from the country for upward of three months and delegating vital
\nofficial functions to inexperienced and unqualified Chinese employees.<\/p>\n
It\u2019s also worthy of mention here that Dr. Jason Han had worked for<\/p>\n
Zhongfu in China for over 20 years and was rewarded with shares in the<\/p>\n
company for his ability to deceive the Joint Venture partners in executing
\nthe JVA, hence his present desperation.\u00a0 The recent happenings in the
\nOGFTZ is simply a disagreement between two Chinese business entities and
\nshould be resolved by their Embassy without dragging other JVA partners in
\nthe mud with them. I can go on and on, on the many sins of the company
\nwhich culminated in its disengagement by the Nigerian Government.<\/p>\n
But let me suspend that for now and set the record straight by stating the
\nfollowing facts held back by Mr Han in his media statements.<\/p>\n
By virtue of a Joint Venture Agreement (JVA) executed on June 14, 2007,
\nthe Government of Ogun State (OGSG) and Guangdong Xin Guang International
\nChina Africa Investment Ltd. (also known as \u201cChina Africa\u201d) entered into a
\npublic\/private partnership (PPP) arrangement wherein OGSG partnered China
\nAfrica in establishing a Free Trade Zone within Ogun State for the purpose
\nof improving commercial activities within the State, particularly,
\nactivities of developing the Zone into a multi-purpose industrial area.
\nThis led to the establishment of Ogun Guangdong Free Trade Zone (also
\nknown as \u201cthe Zone\u201d) in Igbesa Area of Ogun State. It should be noted that
\nGuangdong Xin Guang International China Africa Investment Ltd. is a
\ncorporate body owned by the Government of the Province of Guangdong in the
\nPeoples Republic of China;<\/p>\n
By virtue of the Joint Venture, China Africa owned 60% equity in the Zone,
\nand in accordance with the dictates of its equity contribution, China
\nAfrica funded the construction of the basic structures, infrastructural
\ndevelopment and provision of basic amenities within the Zone.<\/p>\n
As a result, on April 3, 2008, Nigeria Export Processing Zones Authority
\n(NEPZA) issued a licence in the name of Ogun Guangdong Free Trade Zone
\ncertifying same to be under the Nigeria Export Processing Zones Authority
\nAct. China Africa, being the major stakeholder in the Zone, not only built
\nthe main structures and provided basic infrastructural development within
\nthe Zone but also ensured the proper management and smooth administration
\nof the affairs of the Zone from inception till sometime in 2012 when its
\nappointment as managers of the Zone was wrestled by Ogun State Government.
\nIt is important to state here that, that decision was largely due to the
\ndangerous scheming of Mr Han who recruited people to cook lies against
\nChina Africa and scare them away.<\/p>\n
China Africa\u2019s 60% equity investment in the Zone, however, remained intact
\nand unencumbered as this goes to the ownership of the zone rather than the
\nmanagement. This enabled China Africa to entrust its equity holding and
\nmanagement functions to Zhuhai Zhongfu Industrial Co. Ltd. and signed
\nappropriate agreement in this respect. It is pertinent to note that Zhuhai
\nZhongfu Industrial Co. Ltd. is a company incorporated under the laws of
\nthe Peoples Republic of China and carried on business in the Federal
\nRepublic of Nigeria under the name and style of Zhongfu International
\nInvestment (Nig.) FZE.<\/p>\n
As part of the term of the Entrustment Management Agreement, Zhongfu
\ncovenanted then: not to operate illegally; not to harm the interests of
\nChina Africa; not to dispose of the major assets of OGFTZ; to operate
\nOGFTZ in accordance with the applicable laws, rules and regulations.<\/p>\n
As a result of the agreement with Zhongfu International Investment Nigeria
\nas the new manager\/administrator of the Zone, the Ogun state Government
\nequally endorsed the arrangement and then vested the management right in
\nthe company; while the 60% equity stake of China Africa in OGFTZ ownership
\nremained intact and unaffected by the displacement of its managerial and
\nadministrative role.<\/p>\n
It was however shocking , when China Africa discovered that rather than
\nrepresent its interest in the Zone, Zhongfu presented a fraudulent
\nposition to Ogun State Government by concealing the management entrustment
\nagreement with China Africa from Ogun State and presenting itself as being
\nan independent replacement of China Africa, thereby, purporting to enter
\ninto a new Joint Venture with Ogun State Government. When the questionable
\nactivities of Zhongfu came to the attention of China Africa particularly
\nwith regard to embezzlement and failing to render accounts to both China
\nAfrica and Ogun State Government, the Government of the Peoples Republic
\nof China, through her Consulate in Nigeria had to intervene in order to
\nprotect the symbiotic diplomatic relationship between China and Nigeria.<\/p>\n
It was on this basis that the purported Joint Venture of Zhongfu in the
\nZone was duly terminated by Ogun state Government, a JVA obtained by
\nfraud, including the Zhongfu\u2019s management of the Zone. At this point, it
\nis also necessary to state that by virtue of equity transfer through a
\npublic auction, Guangdong New South Group acquired 51% stake (controlling
\ninterest) in China Africa. Accordingly, the Guangdong Province State-owned
\nAssets Supervision and Administration Commission duly notified the Chinese
\nConsulate in Nigeria of the transfer of shares from China Africa to New
\nSouth Group; and by a Diplomatic Note dated March 11, 2016, the Economic
\nand Commercial Section of the Consulate General of the People\u2019s Republic
\nof China notified the Ogun State Government of Guangdong New South Group\u2019s
\nacquisition of the controlling interest in China Africa and the need to
\nformally confer management rights on Guangdong New South Group as the
\noperators\/manager of the Zone, being the representative of the controlling
\nshareholder.<\/p>\n
This also became necessary due to the several indiscretion of Zhongfu
\nInternational including financial improprieties and poor management of the
\nZone. Accordingly, by a letter dated May 27, 2016, Ogun State Government
\nterminated the appointment of Zhongfu as the manager of OGFTZ. Zhongfu
\nwas, by this letter, directed to hand over all Ogun Guangdong Free Trade
\nZone assets in its possession to the Coordinator, Zenith Global Merchant
\nLimited.<\/p>\n
It is also very important to state that, contrary to the falsehood being
\npeddled by Mr Han, Zhongfu did not make any investment in the Zone. The
\nphysical structures erected therein and the amenities therein were put in
\nplace by China Africa. On the contrary, Zhongfu depleted the assets and
\ninfrastructure they met on ground and up till date, are yet to account for
\nall revenues made during the period of management.<\/p>\n
It is therefore no surprise that Zhongfu was only able to express its
\ninvestment in vague terms in his open letter to the President. Since the
\ntermination of Zhongfu\u2019s management of the Zone, the existing investors
\nhave registered several complaints on the inability of Zhongfu to address
\nthe needs of the investors within the Zone. In the same vein, due to the
\nfact that most of the investors within the Zone are aware of the
\nmanagerial pedigree of the New South Group, they have since expressed
\ntheir support for the new management and readiness to work with the new
\nmanagement under New South Group.<\/p>\n
It is also worthy to note that the Government of Guangdong Province in
\nPeoples Republic of China is also looking into the activities of Zhongfu
\nwithin the Zone and in its interface with Ogun State Government with a
\nview to deal with them in accordance with the applicable Chinese law. This
\nis because Guangdong Province still owns 49% equity in China Africa.<\/p>\n
There is no doubt that both Guangdong New South Group and the Guangdong
\nProvince have the capacity to further develop the Zone to match standard
\nof the most notable Free Trade Zones in the World. They remain committed
\nto the course and have already begun works to achieve this, because they
\nhave a clear plan of achieving this and have the support of both the
\nGovernment of the Peoples Republic of China and the Ogun State Government.<\/p>\n
It is therefore surprising that rather than give accounts of how it ran
\nthe Zone for years, Zhongfu has been running from pillar to post, trying
\nto discourage investors from coming to do business in Nigeria.<\/p>\n
Before embarking on another fruitless campaign of calumny against the
\nGovernment and people of Nigeria, Mr Han should please give account of the
\nrevenue generated from the Zone under his company\u2019s management, explain
\nwhy he was collecting revenue into his company\u2019s account ( Zhongfu),
\ninstead of Ogun Guangdong Free Trade Zone, why he hid the Entrustment
\nmanagement agreement with China-Africa from the Ogun State Government for
\nyears until the Chinese Government exposed the deceit.<\/p>\n
This is certainly not the way to do business in Nigeria under the Change
\ndispensation!<\/p>\n
* BOLU-OLU ESHO is an Abeokuta, Ogun State based journalist<\/p>\n","protected":false},"excerpt":{"rendered":"
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