…Owner C’River accepts debt redemption obligation
…Project initially planned to generate N300bn annually
Ben Eguzozie, in Calabar
Nigeria’s toxic bank, the Asset Management Corporation of Nigeria (AMCON) has cleared the path for Tinapa, Nigeria’s $600 million business resort, to begin to receive new investments leading up to its revitalisation, according to recent meetings held between the resort’s owner Cross River government and the bad bank.
In about 18 months, the multi-million-dollar trade and tourism estate in Calabar would begin baby steps to its rebirth.
AMCON offered the state government a respite by allowing it to pay up, in instalments, the resort’s outstanding indebtedness over an agreed period.
A memorandum of understanding (MoU) in 2013 indicated AMCON to buy back Tinapa’s debts totaling more than N18.50 billion; and also provide N26 billion for the revitalization and resuscitation of the resort to reposition it as a private sector-driven enterprise.
On the whole, the business resort is indebted by over N44.5 billion to a number of financial institutions, being funds borrowed to finance its construction.
In February 2021, the ECOWAS Court of Justice ordered the Cross River government to pay $6.5 million to ECOWAS Bank for Investment & Development (EBID), being an outstanding sum of a total $10 million loan it (Cross River) borrowed in 2005 to fund the Tinapa project.
The court also ordered the state government to pay “the agreed interest of 6.5 percent per annum on the sum of $6,455,846 commencing the August 31, 2018 until date of final payment.
Built by former governor, Donald Duke, Tinapa was to be a commercial hub for West Africa raking in millions of dollars. It was initially planned to generate up to N300 billion annually from its dynamic trade and tourism offerings.
Cross River government, owner of the business resort, agreed to AMCON’s new offer to settle outstanding indebtedness for the business resort, built at the cost of about $600 million.
The state government will make full redemption of its obligations through equal monthly instalment payments, and thereafter, pave way for new investments and rebirth efforts for the resort, Erasmus Ekpang, commissioner for information said in Calabar.
Tinapa, with its majestic contours and avant-garde domes of warehouses (each measuring 80,000 square metres—861,000 square feet — and shops —rise defiantly out of the tropical bushes and palm trees. The futuristic film studios, luxury shops and elevated light railway (monorail) leading to the international convention centre, built in 2014 by Liyel Imoke, who succeeded Duke —increased the resort’s offerings.
Additionally, a plush 242-room hotel with a view over the lagoon and a water park with slides were built to cater for the cream of high society and their families. Alongside luxury tourism, imported goods would provide for Nigeria and its neighbours such as Cameroon, Equatorial Guinea, Chad and Niger, competing with Lagos, the nation’s commercial capital.
Guided by former governor, Donald Duke, a handful of businessmen and architects got together and imagined an international centre of commerce and tourism in a free-trade zone model. Subsequently, Nigeria’s biggest banks fell over themselves to finance the project, which was opened in April 2007.
Bassey Ndem, an architect and former managing director of Tinapa, said in a recent interview that, at the initial time, “everyone was excited (about Tinapa)”.
“Tinapa was going to boost economic development of the whole region and create thousands of jobs. It aimed to attract Nigerian millionaires, who ordinarily jetted off to Dubai or London to go shopping, as well as make Cross River a commercial crossroads on the Atlantic coast.
“Everything was going well at first. At the peak, in 2009, we generated $30 million of revenue. But we faced a lot of resistance from the (Nigerian) customs. They really didn’t want the tax-free zone to work,” he had said.
Ndem who left Tinapa (as MD) in 2012, blamed lack of political will by the Nigerian federal government to make Tinapa succeed. He described himself as “angry and frustrated at a wasted opportunity” in the business resort.
Prior to AMCON’s step-in to acquire the trade and tourism resort, none of Ndem’s successors managed to get Tinapa off the ground.
“There was clearly a lack of political will (by the Federal Government) to make the Tinapa project succeed. I describe myself as angry and frustrated at a wasted opportunity,” he said.
Under the Tinapa business resort model, goods were supposed to be exempt from import duties in Tianapa free-trade zone. However, from the beginning, the customs — which has a notoriety for rampant corruption — blocked containers destined for Tinapa in the ports. This hugely paralysed business for the resort.
Since about 2012 till date, Tinapa has become a financial black hole for its backers.
Most development economists and business experts believe Tinapa’s downfall was largely because of a lack of existing infrastructure to transport goods such as: bad roads and an average-sized port. The project was conceived with a deep sea port, which was supposed to enable big ships birth in Calabar.
As a result, the Bakassi Deep Sea port was planned to support Tinapa, helping to bring big ships to Calabar, Tinapa’s operational city. Today, Governor Bassey Otu is to get the deep sea port off the ground with a $3.5 billion mandate facility secured from African Export-Import Bank (Afreximbank).
Some development economists told Business a.m. that it was the responsibility of the Nigerian federal government to build the deep sea port. Sadly, it finally was not done.
