Share this:

Like this:

Like Loading...
" />
Published On: Fri, Mar 30th, 2018

Senate rejects Kaduna $350m W/Bank loan request

Share This

By Ikechukwu Okaforadi and Musa Adamu

Senate yesterday rejected the $350 million loan request to the World Bank by the Kaduna state Government, just as the three senators from the state also kicked against the loan on the grounds that it is not only outrageous but did not follow due process.
Speaking after the loan was rejected by the Senate, the Deputy Senate President, Ike Ekweremadu, who presided over the plenary, said a loan application for infrastructural development is not bad in itself but that failure to consult with representatives of the people before such a critical facility is taken is clearly undemocratic.
While admitting that loan is part of government, he said the law has mandated the Representatives of the people in the state to ask questions and find out if such loan is necessary and if due process was followed in the seeking the loan to ensure that the debt profile of the state is not such that overburdens her economy both now and in the future.
Presenting the report of the senate committee on Local and Foreign Debt which was earlier mandated by the Senate to consider the request, the chairman of the committee, Shehu Sani (APC, Kaduna Central), said based on the submissions and interactions with the invited government officials, the Committee observed that the Development Policy Operation (Budget Support) of $350 million for Kaduna State will likely, further erode the economic viability of the State.
He also said that, according to the latest Debt Management Office figures, Kaduna State has a total debt stock of $232.1 million, adding that approving the current loan request of $350 million for Kaduna State will bring its total debt stock to $582.1 million.
To this end, he said that if this loan request is approved, the new total debt stock of $582.1 million for Kaduna State will be unsustainable and necessarily attract huge financial burden on the meager federal allocation to the State.
“With the new borrowing, the Debt Service to Revenue Ratio of Kaduna State will further be increased and thus impact negatively on the ability of the State to meet Other basic needs of its people”, he said.
He said the Committee therefore recommends that the Senate do reject the request of $350 million for Kaduna State as contained in the 2015 2018 External Borrowing (Rolling) Plan of President Muhammadu Buhari.
However, he observed that the credit facility has an attractive low financing data of 1.25% interest; moratorium of 5 years and a 25 year maturity tenor, and was already captured in the 2016-2018 Medium Term Expenditure Framework (MTEF).
In his remarks also on the loan, Suleiman Hunkuyi (APC, Kaduna North), said the budget claims to finance and provide job for the people and build infrastructure, but there is no stakeholders consultation as required by the world bank on how the loan would be applied.
He said the representatives of the State Executive Council at the meeting for the loan agreement were Commissioner for Women Affairs whose ministry has nothing to do with the loan.
He said the other was a Special Assistant to the Governor, whom he said lacks this requisite knowledge to deal with such negotiation that will affect the state, arguing that the application and request for the loan is a misplaced priority.
Similarly, Danjuma Laah (PDP, Kaduna South), said the loan is not in anyway important, adding that his constituents did not give him the authority to approve it.
He said he had asked government authorities in the state what the loan would be used for, but they have not been able to explain to him, pointing out that for him to give approval, he needs to be informed about the projects on which it would be invested on, the contractors handling the project and where the projects would be cited.
Sequel to this, the Deputy Senate Leader, Balla Na’Allah, said the senate should not waste time debating the loan request, but respect the wishes of the senators and reject the loan.

Leave a comment

XHTML: You can use these html tags: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>

%d bloggers like this: