…As govt allays fear There is much ado about Edo State Government foreign debt portfolio of $276.25m which was recently released by the Debt Management office (DMO). The amount represents 6.53 per cent of the sub-national foreign debt of $2.12bn, according to DMO data owed by the 36 States of the federation and the Federal
…As govt allays fear
There is much ado about Edo State Government foreign debt portfolio of $276.25m which was recently released by the Debt Management office (DMO).
The amount represents 6.53 per cent of the sub-national foreign debt of $2.12bn, according to DMO data owed by the 36 States of the federation and the Federal Capital Territory Administration as of December 31, 2018.
Edo State occupies the second position in the chat which Lagos is on top of the list with a foreign debt portfolio of $1.43bn which represents 33.81 per cent of the debt.
The DMO analysis also revealed that Kaduna emerged third while Cross River State came behind the rear as 4th in that category.
Besides, Edo State government currently service the debt with over N502 million monthly.
In a statement on Tuesday, the Special Adviser to Edo State Governor on Media and Communication Strategy, Mr. Crusoe Osagie, allayed fears about the debt about its repayment plan.
He said the State enjoys, were accessed as a result of transparent and prudent financial management.
Mr. Osagie admitted that Edo State topped the list of sub-nationals with high external debts after Lagos State.
He said the State government prioritises sustainable development and judicious use of state funds, which is what has enabled it to promptly access the low-interest credit from multilateral organisations.
Osagie also argued that it was erroneous to assume that foreign credits are bad, noting that they help to fast-track development at the lowest cost of funds possible.
According to him, “Foreign credits usually come with single, lower digit interest rates, ranging from one to five per cent.
“They carry many years of moratorium, that is, a period within the tenure of the loan when the borrower is not required to make repayment.
“This gives the borrower more time to bring development to the people and therefore increase the capacity to repay the loan.
He said, “contrary to opinion by less informed people that ranking as the second state in the country after Lagos with the highest foreign debts portfolio is a negative feat”.
The Governors aide explained further that “it is actually a positive development because this simply indicates that Edo State, like Lagos and Kaduna States, are the few States in the Country”.
He further explained that “with the requisite level of transparency in governance to access the huge international pool of development financing to help improve infrastructure and enhance the living standards of the ordinary people.”
He stressed that what is important is that the Governor Obaseki-led Edo State Government is putting every penny sourced from the Federation Account, Internally Generated Revenue (IGR) and international development financing to judicious use to improve the lives of the people.
“In less than three years, Obaseki’s government has constructed more roads than previous governments were able to do in 16 years.
“We have revamped and rebuilt basic education almost to the point of re-invention.
“There is a primary healthcare revolution currently going on in Edo State, as well as the big-ticket transactions of the Benin River Port, Benin Industrial and Enterprise Park, the Benin Modular Refinery Project and many more, where we are making steady progress,” he said.
Mr. Crusoe stressed that many of the states that are ranked low on foreign debts in DMO’s records are not necessarily happy to be in that position, as they would have preferred that they had the requisite governance structure and transparency in financial management to attract these useful funds from international development finance institutions.
But, an independent investigation by our Correspondent revealed that the State governor, Godwin Obaseki’s transparency and prudence in management of public funds compared to the previous administration of Adams Oshiomhole which borrowed lesser than the latter.