In his major interview since he left office, former Cross River State Governor, Liyel Imoke speaks on issues regarding his administration, especially the Tinapa project. Excerpts…
Former Governor Donald Duke recently insisted in an interview that “The Death of Cross River State Happened In 2007” when you became governor. How do you react to this?
Let me begin by saying that the reason I have not spoken all this while is three-fold. Number one is my respect for the office of governor, which we both occupied, and what it represents; number two is the commitment to the success of the Cross River State project, irrespective of our differences; and, number three – and more importantly – the fact that telling it as it is about Tinapa, for instance, would have made it near-impossible for any investor to take a second look at the project, which has cost the government and people of Cross River State over N100 billion (one hundred billion Naira) in contingent and other liabilities. I didn’t want to put the death knell on this white elephant.
One of the values my father instilled in us is humility in service and to let the works of our hands speak for us. My silence over the years in the face of unbridled attacks and false accusations would be better understood in relation to the role God used me to play in Donald’s political development.
Let me give you a bit of a background to the political evolution of Cross River State during the time under scrutiny. In 1996, a group of us came together in Lagos under my leadership to chart a new course for Cross River State. I had already served as a senator and I leveraged on the relationship and clout I had garnered during my short stint in the senate. When I suggested that he run for governor, Donald hesitated; the sentiments at the time did not favour someone of Efik origin emerging as governor especially without any political pedigree. I was thereafter now saddled with the burden of delivering an otherwise difficult candidate, in both the party primaries and the general elections. Though an uphill task, the rest is history. Senator Gershom Bassey and a few others were part of this, and I am sure they can tell the story better. He talked of a blueprint in the interview he granted, but conveniently failed to recall that the said blueprint was developed in my house on Victoria Island in Lagos.
Tinapa was not part of that blueprint.
Tinapa failed before he left office. It was poorly conceptualised and became a burden on the state in the course of its execution. There were several policy and regulatory issues that should have been addressed either before or in the course of project implementation, as Cross River State did not have the capacity and resources to carry the burden of sustaining a going concern of that magnitude.
The project was financed with loans of billions of Naira guaranteed by the state and the Federal Government. The project was supposed to pay for itself; it never did, because there were no investors. Private money only goes where it makes business sense. And the fact that no one other than the bankers to the state government, who were coerced and threatened with loss of patronage, invested in Tinapa, is clear indication of its failure ab initio in both conceptualisation and execution. All in all it was at best a project not based on any economic or fiscal realities and can best be described as a fantasy of the imagination. There was not up to N80m (eighty million Naira) of private money in the multi billion Naira Tinapa, yet, it was touted as a ‘model public-private partnership project’ (PPP), without any elements of a well-developed PPP project. Tinapa was touted and advertised on DStv at the expense of the poor people of Cross River State. Local government funds were used by him for his outlandish and unsustainable project. Feasibility studies were altered to suit his convenience, as confirmed by the consultants to the project, KPMG, with last minute add-ons like Studio Tinapa.
Needless to say, the state government defaulted on the N40 billion (forty billion Naira) loan repayment that had fallen due while Donald was still in office. The Federal Government guarantee was called by the banks before Donald left office, because the loans fell due and there were no investors or private sector partners to manage Tinapa and ensure the loans were serviced. Debts fell due and yet he continued to borrow even beyond the N40 billion (forty billion Naira). Tinapa became an albatross before he left office. It was a misconceived project, commissioned with equipment which was hired from abroad by a company called Dream Entertainment; all of which vanished after the commissioning. Tinapa was commissioned with no tenants, no gazette, no fiscal policy framework or regulations and no operating guidelines; this explains why the private sector did not buy into the project. It was commissioned without completing the hotel and the waterpark which I eventually completed.
In May 2007, the month I was sworn in as governor, the Federal Government made its first huge monthly debt service direct deduction of N900 million (nine hundred million Naira) from the state account. There were other loans from local banks, the ECOWAS bank and other financial institutions that had all fallen due for repayment, (some of them Dollar denominated). I was saddled with the heaviest debt burden of any state in this federation, with over 50 per cent of all the state revenues going to service the various questionable loans, thereby making it literally impossible for the state to meet its recurrent obligations, including salaries and overheads. Yet, I did not say a word of criticism. I was accused of protecting him at my own expense. Recall that in 2007, he ran for the office of president, largely on the perceived success of Tinapa. Rather than expose the facts, I chose to remain silent.
I actually incurred further debts to save the white elephant. UBA (United Bank for Africa) had called the federal guarantee, and Donald asked me to move the state account to Oceanic Bank so we could get a facility through the then managing director, Mrs. Cecilia Ibru, who he was close to. We used some of these funds to complete the hotel, the waterpark, and the outstanding infrastructure, including the dualisation of the City Gate to Tinapa Road. This is just to give you the background so you are better informed on the issues in focus.
Inspite all of these problems from the start, what did you do to ensure Tinapa the ‘white elephant’ as you describe it, did not die?
Given the huge debt burden which the state carried, I had no choice but to make every effort to get Tinapa to work to reduce the financial hemorrhaging. We took a number of steps to revive Tinapa, including our negotiation with AMCON (Assets Management Company of Nigeria) to take over the facility and bring in an investor, which was eventually scuttled by the same Donald; but that is a story for another day.
We went into a partnership with Ebony Life TV for the use of the otherwise moribund Studio facilities. We introduced a games and amusement arcade and converted one of the warehouses into a small conferencing facility.
We subsidised rents and offered further incentives to potential tenants just to increase the footfall, and in the case of T-Mart a retail outlet sponsored by Donald, rent was free.
We located the ICT Hub, ‘Tinapa Knowledge City’ in Tinapa. The hotel and the waterpark were completed and furnished and became fully operational.
We invited Silverbird and several other such companies to take up the movie theatres but they declined after doing their viability studies. In spite of all the efforts, Tinapa remained unattractive because of its initial misconception by Donald.
Staying with Tinapa, as that is actually the biggest bone that needs explaining. Duke insisted that the difficult part of the project had been done. Given your hands-on experience on the project, will that position be correct?
Contrary to what Donald wants the public to believe, the brick and mortar was actually the easy part; borrow money, pay Julius Berger and they will build what you want. The hard or difficult part is making it work; and after our own analysis – which he knows – it clearly showed that Tinapa could not work for reasons earlier stated not to talk of other critical infrastructure requirements like construction of access roads into Calabar (example, Port Harcourt/Calabar road, etc), a functional, duty free, sea port and an expanded airport; all of which were outside the control of the state government and needed the buy-in and financial provisioning in the budgeting of the Federal Government.
Needless to say none of which was provided for during the three year project development and construction phase of Tinapa. That to my mind is the hard part. Shopping malls are built on the basis of signed agreements with anchor tenants who will open shop immediately upon completion, but there was none. There was not a single anchor tenant in Tinapa at commissioning.
So, Donald failed to do all that was necessary, but instead busied himself building brick and mortar without thinking about how the project would work. So he commissioned the project with fanfare and at great cost, and there was no Walmart.
Well, he insisted you drove away Walmart. Did you?
He is accusing me of driving Walmart away! But there was no Walmart! An organisation like Walmart would never commit to operating in a place like Tinapa with all the issues I have enumerated above. Only an illiterate would think that this could happen. If in the three years of project development and construction and up to commissioning, Walmart was not in Tinapa, how do I get accused of driving Walmart away? Furthermore, free trade zones are on the Exclusive Legislative List, and state governments can neither legislate nor regulate free trade zones. And yet Tinapa was a free trade zone. So Donald puts billions of Naira of state funds into a project over which the state has no operational or regulatory control. During the three years of construction, he did not think it wise to either partner with the Federal Government or get the federal government to approve a special fiscal policy or regime for Tinapa’s operations. To him, it was obviously an afterthought.
I eventually obtained the gazetted regulations for Tinapa, which were unfortunately inadequate, from the new administration of President Umaru Musa Yar’Adua in 2008, more than a year after Donald had left office, by which time Tinapa was already in its debt throes. Of course Donald’s nonchalance and arrogance to the President-elect at the commissioning of Tinapa certainly did not help our case.
Just to ensure I gave the project a fighting chance howbeit slim, I retained the managing director, of Tinapa, who Donald appointed, for the purposes of continuity for the duration of my tenure. That MD was Bassey Ndem. I must give Bassey Ndem credit for literally making a little out of nothing. He kept the place running, howbeit with heavy subsidy from the state government for power, staff salaries and other sundry expenses. It is instructive to note that it was also the same Bassey Ndem who managed the project during the construction phase.
He also punched holes at your decision to build the Calabar International Convention Centre insisting that it is not functional.
Typical of Donald it is difficult for him to acknowledge or give credit to anything he did not initiate. Therefore, I am not surprised at all. It is however ironic for him to say the Convention Centre is not functional. In actual fact, the Calabar International Convention Centre is fully functional and far more utilised than Tinapa. He, Donald, has attended more events at the Calabar International Convention Centre than he has visited Tinapa. The state-of-the-art facilities continue in the Calabar International Convention Centre to attract major events, conferences and meetings from within and outside the state with attendant economic impact.
Another point he raised on is the issue of continuity; is it true that you did not continue with projects he initiated after he left office?
I have always believed that it is in the public interests that on-going projects inherited by an administration be completed and utilised to serve the public good. I made sure that every single project that Donald had left uncompleted received attention.
There are various projects which fell into this category that we completed. Some of these include the dualisation of the City Gate – the Tinapa Gate road. People sometimes forget that this was a single lane road. The Lemna Road, even though Lemna was a bad construction company, and only existed in Cross River State and did very bad work, we still completed the dualisation of the Lemna Road. The Street lighting which was limited to Marian Road, the Urban renewal program which was limited to Calabar Municipality amongst others.
The Obudu Mountain Resort was not left out. We brought in Southern Sun as operator/managers of the facilities. They eventually pulled out of the management of the ranch because it was unprofitable. We then had to find ways and means to sustain the ranch, because the ranch model wasn’t working, especially with the huge cost of maintaining a cable car, which was not utilised because the ranch itself has 150 rooms, and the occupancy rate was well below 50 per cent; and of course most people preferred driving up the ranch to using the cable car. So even though the cable car was supposedly an attraction, it was certainly not a revenue earner. We subsidised the cable car to the tune of N20m (twenty million Naira) monthly. The Ranch suffered loss of patronage after two aircraft crashed around Bebi with unfortunate loss of lives. We upgraded the safety and landing facilities at the Bebi Air strip to avoid any other air disasters.
So, which other inherited projects of the Duke administration did you continue with?
Well, one other project I can easily mention is the Obudu Mountain Race; we kept the Mountain Race going, amongst other things, until I left office; in fact, we took it beyond where we met it. I grew the Mountain Race and it became the African Mountain Championships. That’s just the value addition to that project, as we did with regards to everything he left behind. Of course the Calabar Carnival, another project which he started we continued and added value to.
All of these things that we continued to do were in spite of the huge debt burden of well over N100 bn (One hundred billion Naira) left behind by Donald. This huge debt overhang was as a result of Donald’s outrageous ill-conceived vision, without any recourse to economic reality. He ignored the critical partnership needed with the Federal Government, particularly with regard to infrastructure and policy, in developing viable and sustainable tourism. It was all centred around him and his person, which meant none of them was sustainable. Because the projects were not economically viable, we spent a good part of the state’s resources subsidising the operations of a number of his projects.
React to Duke’s fervent insistence that you prevented Walmart from coming to Tinapa even after then President Obasanjo had signed them on.
For starters, President Obasanjo never signed Walmart for Tinapa.
On his allusions about Walmart I would have thought that when you are constructing a shopping mall facility, if Walmart is going to be your anchor tenant not only would they have signed an agreement pre-construction, but they will also be present at the commissioning. Furthermore, President Obasanjo left office in 2007 along with Donald. So when did this Walmart issue happen? We need to set the records straight. I have never, ever rejected any investor that wants to come into Cross River State. As a matter of fact, I should say it is to the credit of my administration that we brought in General Electric as a huge investor into Cross River State; we also brought in Wilmer, the largest oil palm producing company in the world, as a major investor into Cross River State at no cost to the state government. We also brought in SPAR who built this ultra-modern shopping mall on the Cultural Centre premises during our tenure. So why would we not welcome Walmart?
Again, I think that it’s important that we understand and appreciate that Cross River State became an investment destination during my tenure, and we put the right policies in place for that to happen, including the setting up of the Investment Promotions Department for the first time in the government of our state.
At some point, Aero Contractors was flying to the Bebi Airstrip on the Ranch, but he also alleges that you stopped Aero from flying to the Ranch. Did you really do that, and why?
The truth is that we were subsidising the cost of Aero Contractors flying to the Ranch; we were paying for empty seats. We had inherited a debt of over N80 million owed Aero Contractors for flying empty to the Ranch. I had to take a decision on whether to continue with the subsidy or to do things differently. We had to make sure that people of Cross River State were served, not just the leaders and/or the elite class. Aero Contractors stopped flying to the Ranch as a result of the debt burden that we had inherited. But in spite of that you will recall that there were two air crashes flying into Bebi Airstrip that discouraged flights into the airstrip. But at the same time, I still went on to invest in the Bebi Airstrip, in the Instrument Landing Systems and other landing facilities to improve the airstrip itself and make it possible for flights to land on the Ranch, in spite of the crashes. We hosted President (Goodluck) Jonathan, and others, flying into the Ranch and spending some holiday time; there was also a former president of Senegal and a host of others, who flew into the Ranch when I was governor.
There was the issue of the Reserve Fund, which he alleged was squandered on ‘useless projects’. Can you please also shed some light on this?
We need to relate the Reserve Fund to the debt burden. How much was in the Reserved Fund when he left office and how much was the state debt? We had a Reserved Fund into which the state contributed N50m (fifty million Naira) monthly, and the 18 local governments each contributed N1 million ( one million Naira) monthly. These contributions were sustained and invested. The challenge was that we had a huge debt burden. So you have a Reserved Fund with maybe a billion Naira, but a debt burden of over N100bn (one hundred billion Naira). So, why has Donald never made any reference to the debt burden that he left? Why is it just the Reserved Fund?
The Reserved Fund was not exclusively owned by the state Government, it belonged to all the parties (investors); and its utilisation for projects as it were, was in compliance with the law, as amended. The state government and local governments who are investors in the Fund approved the utilisation of those funds for projects like the Institute of Technology and Management (ITM) in Ugep, a necessary and practical intervention for the development of middle level skilled man power direly needed in the state. It is visible and functional today.
The Fund was valued at close to N5bn (five billion Naira) when I left office. Donald’s estimated value of N190bn (one hundred and ninety billion Naira) is clearly a fiction of Donald’s imagination.
From the interview, the former Governor Duke refers to you as “serial failure”, and says you “failed as minister and in Cross River State.” What is your thought?
Well, the only thing that I have to say is that his only political success was when I drafted him to run for governor and managed both his campaigns – at primaries and at election proper. He has been a serial failure since we parted ways, after he did everything within his powers to undermine me and to make sure I didn’t succeed him as Governor. He failed to obtain a nomination as the Presidential Candidate and every candidate he has supported for elections in the state to date has been unsuccessful, I have no doubt that he will continue in the same vein particularly as he has not done anything tangible since he left office as governor. You can’t become President on a deceitful distorted foundation. He failed in Cross River State, and as such, can only look for whom to blame. I would like to let him know that Cross River State did not die in 2007 when I took office; maybe somebody’s spirit died, but Cross River State did not die in 2007!
Throughout my political career I have provided purposeful, selfless leadership and enjoyed popular support that led to Donald’s success at the polls against all odds. For a governor who left maybe a few hundred million Naira in the Reserved Fund and a debt of over N100bn (one hundred billion Naira) and outlandish but unsustainable projects all over the place, he certainly didn’t have the best interest of the people at heart.
We established a debt management office to manage the huge debt over hang. The Debt Management Office negotiated the restructuring of those debts, lengthening the repayment period and found ways to manage the debt, pay salaries and still invest in projects and programs in the state. The State DMO worked in collaboration with the Debt Management Office of the Federation, and I can tell you that as of today Cross River State is still paying Tinapa’s debts. We must all agree that when a state carries such a huge debt burden the people suffer, because their future has been mortgaged.
I have reliably been informed that he is even trying again to put the state in further debt by endearing himself to the current governor, Ben Ayade, and getting Ben Ayade to guarantee another loan for Tinapa even as we all are still reeling from the debt burden which he left for us. However, I know that Ayade is smarter than that; he will not further mortgage the state to satisfy Donald’s over-inflated ego.
Another issue is that of the Convention Centre, which he questioned because Tinapa was already there. Why did you go ahead to build the Convention Centre and the monorail?
As an eternal optimist, I made a last ditch effort to save the white elephant called Tinapa by siting the award-winning Calabar International Convention Centre (CICC) within the precincts of Tinapa and linking the Tinapa Hotel in particular and mall to the Convention Centre. Cross River State has become a destination for meetings and conferences and needed a facility to attract top-notch events. Again, it was a last ditch effort to create a tourism hub around Tinapa. I think most people appreciate that; but I’m sure Donald will never appreciate that.
In his interview, he also mentioned the monorail. You will recall that the monorail was another outlandish and unsustainable project of Donald’s which the banks refused to finance because of the faulty feasibility studies. His feasibility studies was based on the presumption that 3000 (three thousand) people will ride on the monorail daily going directly from the airport to Tinapa. This meant that a minimum of 60 (sixty) full flights daily would land and take off in and from Calabar Airport with every passenger going directly to Tinapa on the monorail.
The Afreximbank (African Export-Import Bank) and several other banks were approached by Donald to finance the monorail project adding to the already huge debt burden. All the banks rejected his request for financing for obvious reasons. Unfortunately I was stuck with the project since billions of Naira had already been invested in faulty feasibility studies and some procurements.
We tried making it viable by proposing alternative traffic routes connecting Watt market, UNICAL and other heavily populated parts of the city unsuccessfully. Rather than let it all waste I thought to use the tracks that had already been ordered by Donald but paid for by my own administration, to link Tinapa to the Calabar International Convention Centre, and by so doing, to bring Tinapa closer to the city. A recurrent complaint by the few prospective investors was that Tinapa was too far out from the city. So I tried to use the monorail to link those facilities, create a hub and of course, make the best use of what I was already stuck with, which was the tracks for the monorail. I recall that in my dilemma, I took a former president to the CICC project site when we started construction; and I told him what my thoughts were on the project. And after my effort at explaining it to him, he looked at me and took a deep breath; he looked across to Tinapa and said to me ‘Liyel, I understand what you are trying to do; you’re trying to paint a white elephant black.’ Need I say more?
How did you perform as Minister of Power and Steel?
We achieved the fastest growth in power generation during my tenure. And of course we embarked on the NIPP (the National Integrated Power Project), which is still under construction and which is sustaining power supply to Nigerians till today; not to mention the reforms in the power sector. However, I left a few months into the commencement of the NIPP project. But it will be irresponsible of me to blame Babatunde Fashola or ministers that succeeded me for all that might have happened in the power sector after I left. I would have hoped that Donald was intelligent and enlightened enough to know that nothing near $3 billion was spent on NIPP as at the time I left office; so his reference to 16 billion was calculated. He had to take a swipe. Of course it must hurt him to his marrows every time he drives past the 560 megawatts Odukpani Power Station which was constructed when I was in office. It must hurt him to his marrows every time he is driving to Tinapa and sees the huge transmission sub-station bringing power from the Odukpani Power Station, which was constructed when I was in office as minister; not to talk of distribution projects in every local government area of Cross River State.
It must be painful to Donald that I succeeded in delivering roads in Boki and all local government areas in the state when he said ‘it would take the entire state budget to do a few kilometres of roads in Boki’. A thousand kilometres of rural roads with bridges were constructed during my tenure as governor. It must hurt him that I embarked on the construction of Calabar South roads, the ancestral land of the Efiks, and transformed Calabar South from its previous derelict and decrepit look to how it now looks; not to mention the huge Channel II Drain that was constructed during my tenure, which stopped their homes from being flooded during the rains. It is a pity that he cannot acknowledge that when I was sworn-in, only Marian Road had street lights. But that by the time I left, the whole of Calabar South, Calabar Municipality, State and Federal Housing Estates, Summit Hills, and all the major highways had streetlights; specifically 134 kilometres of streetlights were constructed. Donald must never have driven down the Goodluck Jonathan Bypass, or the link bridge; I’m sure he hasn’t crossed the new Idundun Bridge either.
We transformed the Calabar Carnival, (which he started), into an outstanding spectacular international event in the eight years that I managed it. We branded it, expanded it and put it on the global tourism calendar. How painful that must be to him. It must be painful to Donald that we did Obudu urban roads, we did Ogoja urban roads, and we expanded Ugep urban roads. It must be painful for him that we delivered innovative healthcare programs, renovations of schools; and equipped our schools across the state.
The Comprehensive Sports Development Program, winning five successive championships and playing host to the National Football Teams, and the upgrading of the Stadium and the sports facilities in the state including the new Ikom Stadium.
It must be very painful to him that we succeeded where he expected us to fail in spite of the huge debt burden which he left behind. Donald claims that he electrified 80 per cent of the communities in the state; that is a very interesting number! We can check the records. We can specifically state that we electrified 176 communities, and as minister of power and steel, I got the Obudu Ranch communities and the Ebrutu axis of Odukpani electrified with the support of the Japanese Government. He must not have heard of the modern civil service housing estate in Akpabuyo with provision of road infrastructure, water and electricity which provided Civil Servants an opportunity to own their own homes. Donald wants to believe that nothing good has happened to Cross River State since he left office in 2007. The stark reality is that in spite of the challenges, which he left behind, many good things have happened to Cross River State since 2007. I believe that the people of Cross River State are not blind.
In CRS, Did you play any role at all in ending the Atam Congress?
It’s typical of him to talk about the Atam Congress in the manner he did in that interview. Everyone familiar with the issues knows the role I played in taking a position against the congress. But my friend dares not acknowledge it. It was through my intervention that we killed the Atam Congress movement. I was vilified and called a traitor because as an ‘Atam man’, I worked against the Atam interest. He was the beneficiary. He says he did it all on his own. I also recall when the common saying was that ‘an Efik man can never be governor’; and against all odds, I stood my grounds, taking a position against parochialism and ethnic bigotry. Again, Donald was the beneficiary.
Any final thoughts?
It is unfortunate that it has come to this, as I have always believed that public service is about the people and meeting the needs of those who need government the most; it shouldn’t be about blowing our own trumpets or running others down. I have hitherto refused to join issues with him, but I am constrained at this time to set the record straight.
Donald left office 11 years ago and I left office three and a half years ago; we were both elected to serve and by God’s grace we contributed our quota, leaving Cross River State better than we met it. It is a very rare privilege which must not be abused and used to aggrandise ourselves.
I pray that this puts an end to Donald’s vengeful vilification of my person, and that he charts his own course without having to pull others down.
Culled from an interview granted to www.calitown.com
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