The Business and Property Court in London has ruled in favour of the Nigerian government in its legal case against Process and Industrial Developments (P&ID) Limited, an engineering and project management company, squashing an $11 billion arbitration award initially issued in favour of the company.
Here’s what you should know about the situation and how Nigerians are reacting.
It started in 2010. P&ID entered into a business agreement with the Nigerian government, and the plan was to build a gas processing plant in Calabar, Cross River State. It was a contract billed to last 20 years.
Two years later, P&ID claimed the deal couldn’t pull through because the Nigerian government didn’t keep their side of the agreement. According to them, the FG failed to put in place the required infrastructure to kick off the project.
The company took the case to court. On January 31, 2017, a tribunal ruled that the Nigerian Government should pay $6.6 billion in damages to the company, as pre and post-judgment interest at 7%.
The FG applied for an extension after the ruling and the application was granted by Judge Ross Cranton in September 2020.
In the application, the FG alleged that P&ID tried to defraud the country with the deal, adding that officials of the company paid bribes to secure the contract.
In March 2023, the FG argued in a trial court that the P&ID deal was conceived through dishonest means, and as such the awarded sum, which had risen to $11 billion due to the 7% pre-and post-judgment interest, should be thrown out.
Court Rules in favour of Nigerian Government
On October 23, 2023, Justice of the Commercial Courts of England and Wales, Robin Knowles, upheld Nigeria’s prayer on the ground that the P&ID contract was obtained by fraud.
If Nigeria had suffered a negative ruling, this would have seen a significant hit to the country’s foreign reserves. As of May 2023, the foreign reserves stood at $34.4 billion.
How are Nigerians reacting?
The ruling has sparked reactions from Nigerians on social media. Almost everyone acknowledges paying the sum would have seriously affected the country’s already weak economy.
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