How agreements can result in financial losses — Osinbajo - NATIONAL TRUMPET


Monday, June 28, 2021

How agreements can result in financial losses — Osinbajo

Vice-President Yemi Osinbajo says poorly negotiated economic agreements have led to illicit financial flows and losses for many nations.

Osinbajo stated this at the opening capacity-building event for Nigerian negotiators organised by the Independent Corrupt Practices and Other Related Offences Commission (ICPC) on Monday in Abuja.

The event was organised in conjunction with the Inter-Agency Committee on Stopping Illicit Financial Flows (IFFs) from Nigeria.

He said that Guinea and Pakistan had suffered economic losses arising from poorly negotiated bilateral investment treaties, observing that Nigeria had also been confronted with similar issues.

He identified some factors as being responsible for the lapses to include lack of knowledge of the specific subject matter, lack of accountability, and corruption.

According to him, people must be held responsible for poorly negotiated contracts while transparency and due process must be encouraged.

Osinbajo advocated that arbitrators that must be engaged should be experts in the subject matter in negotiating foreign contractual agreements.

He said that the rule of origin should also be considered, recommending that rules and guidelines for negotiations should be drafted with care and circumspect with regards to the country’s objective.

The Chairman of ICPC, Prof. Bolaji Owasanoye, while speaking on the “Guidelines for Negotiating International Agreements for Economic Development”, said that the essence of governance is development.

Owasanoye said that governance and development are mutually reinforcing, noting that negotiation of commercial agreements is linked to economic development as poorly negotiated agreements would affect development.

“Therefore, there is a strong nexus between the negotiation of agreements and attaining the aspiration to develop.

“The environment of negotiation for international agreements such as finance, trade, investments, environment, taxation is a mix of legal and political factors.

“Negotiators of developing countries often mistakenly assume that beneficial agreements can be concluded mainly by diplomatic, political, compassionate, human rights or other non-legal considerations alone.

“Given the fact that the outcome becomes legally binding, it behooves negotiators to prepare themselves for a legal outcome and its implications on development rather than on sentimental considerations,” he said.

The Special Assistant to the President on Economic Matters, Dr. Yemi Dipeolu, said that nation must develop a core of negotiators who could tackle the menace of illicit financial flow.

Dipeolu also stated that a poorly negotiated agreement could lead to serious financial losses on the part of a nation.

He identified some practical tips for successful negotiation to include observation, preparation, assembling of a strong inter-disciplinary team, and familiarity with the subject area.

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