Chairman, Senate Committee on Foreign and Local Debts, Senator Uzamere Ehigie
The Chairman, Senate Committee on Foreign and Local Debts, Senator Uzamere Ehigie, Monday warned state governors over reckless and excessive borrowing from local and international organisations to implement their various projects under the Medium Term 2012-2014 External Borrowing Plans, which add up to $3 billion.
Ehigie spoke when the Governors of Ebonyi, Bayelsa, Kwara Kogi, Delta, Enugu, Niger and Ondo States who were represented by their various Commissioners for Finance presented their templates on the implementation of the loans if eventually approved by the National Assembly.
Senator Ehigie said: “The issue of internal or foreign borrowings by states have become something that comes with sad tales especially in the past. “This time around, we are critically looking at all sides and implications for future generations who will bear the burden of repayment.”
He promised that state governments will not be allowed or given blank cheque to borrow as it used to be, adding that the Senate will not allow a situation where the future generation will be subjected to perpetual slavery because of borrowings or loans which they knew nothing about.”
According to Ehigie, the Senate will not just sit and watch the deployment of the loans to the various projects, they will henceforth be involved in rigorous oversight function and monitoring in the course of implementation.
He stated: “We appeal to you all to ensure that at the end, these loans are judiciously utilised to specific areas as agreed in your various templates which you have come here today to defend.”
In a remark, Delta state Commissioner of Finance, Mr. Bernard Okumagba, said his Delta state government is committed to delivering on several projects that will fast track the rapid socio economic transformation of the state.
He added: “The terms and conditions for the credits are typically maturity periods spanning 40 years, a grace period of 10 years, service charge of 0.75 percent and commitment charge of 0.5 percent.
“Based on our records and independent reviews and ratings carried out by third parties such as the Global Credit Rating agency and Agusto and Co. And the Debt Management Office (DMO), it is clear that Delta state is capable of sustaining additional borrowing.”
He added that the state is seeking $39.78 million to fast track its job creation drive, access to socio-economic services and improving public expenditure management systems.
“The focus is on youth employment through public works including roads, maintenace of public spaces, collection and disposal of waste, carrying out agricultural and technical training and community development projects.” he said.