The House of Representatives has so far given approval to Abia, Ebonyi, Enugu and Kano State Governments to continue negotiations with the Development Partners on the 2016-2018 external borrowing plan.
Breakdown of the foreign loans shows that the sum of $350 million is for Kaduna state; $110 million from Islamic Development Bank (IDB) for Katsina state health project; $32.4 million from the Islamic Development Bank for implementation of Jigawa State Agricultural Enterprise Development Project; $200 million facility from African Development Bank for Abia state; $266 million from Islamic Development Bank requested by Niger State for dualization of Minna-Bida road.
Adeyinka Ajayi, Chairman, House Committee on Aids, Loans and Debt Management disclosed this while giving update on the engagement with representatives of the seven state governments that have so far appeared before it.
“We have so far taken seven states, we are left with three states. We are waiting for further materials for some of the started that we have intrrcated with, after that the committee will retire to consider all the submissions and make recommendations to the House.
“Last week, we had a recommendation that was accepted by the House and that recommendation is to the effect that all ongoing negotiations can continue. I bleive that should encourage the Development partners to conclude the terms and conditions on the foreign loans with the States that we have concluded with. Those states are: Enugu, Ebonyi, Kano and Abia states.”
He expressed optimism that the three other states which appeared before the Committee on Tuesday namely: Kaduna, Katsina and Jigawa may also enjoy similar approvals with the approval of the House.
As part of measures put in place to ensure compliance with the provisions of the Fiscal Responsibility Act on external borrowing plan, he assured that the Committee will interface with State Houses of Assembly to ensure that the facilities are appropriated for, effective implementation of various developmental projects captured in the external borrowing plans benefits of the citizens.
Ajayi also emphaised the need for the borrowing entities to ensure that foreign borrowings are channeled to capital expenditure and huna development related projects and programmes as well as ensure that the states are able to service the debts within the terms of agreement by both parties.
According to the documents submitted by Kaduna State government to the Committee, in 2016, the state spent the sum of N62.2 billion on socioeconomic and infrastructural development, a huge leap from N27.6 billion and N17.6 billion spent in 2015 and 2014 respectively.
According to the documents on loan deductions for 2017 fiscal year, presented by the office of the Accountant General/Ministry of Finance Katsina state, stood at $761,673,957.62 so far; bail out worth N847,603,029.93; N802,204,645.37 from ECA loan totaling N2,411,481,632.92.
For 2016 fiscal year, the deductions of the state’s foreign loan stood at N1,017,432,180.74 while the Bail-out stood at N2,557,844,647 totalling N3,575,276,827.74.
Likewise the deductions for 2015, foreign loan stood at N878,172,063.91; 25% fertilizer subsidy stood at N406,543,587.50; FAAC Sub committee on subsidy stood at N1,284,715,651.41 while FG salary bail-out stood at N389,034,402.86 totaling N2,958,465,705.68.
All the requests were in addition to the total external borrowing plan of $1,492,4000,000 for 2016-2018.
Speaking on behalf of Governor Nasir el-Rufai of Kaduna state, Abdul Kwari, State Commissioner for Finance, assured that the $350 million if approved would be used to create jobs and strengthen economic stability of the state.
“It cuts across other forms of governance in the system which includes the Treasury Single Accout and we have adopted a zero based budgeting system in the state. Public finance control and assessment law was also domesticated against the archaic way of doing things in the past.
“That’s why the state is being viewed as the most business friendly state. We have reduced tax procedures and dealt with the issue of the multiple taxation in the state.
“The public procurement law which is brand new in the state has also reduced the process of awarding contract as the new law now enables people to undertake procurement online”, he said.
Kwari added that in Kaduna state, title acquisition process for landed property has been streamlined to the effect land procurement application takes just two months through the State Geograpic Information System
“The fortune of the state allocation from federal has been declining since 2013 and we are making effort to shore up IGR which has been on the increase. In 2014, it was N15 billion and in 2015, N13 billion and now N23 billion in 2016 and we feel this effort should be appreciated as we are working toward a stable revenue base for the state”, he added.
Speaking on behalf of Governor Aminu Masari of Katsina State, Mariatu Bala Usman, State Comissioner for Health, explained that the $110 million facility is for construction and renovation of 136 primary, secondary and tertiary health centres across all the Local Government Areas.
She assured that “the projects would incorporate the establishment of a public health laboratories,” as part of measures for preparedness against emergencies especially with the lessons learnt from the outbreak of Ebola and Lassa Fever across the country.
Asked about the loan repayment plan vis-avis the conditions given by the bank to grant the facility, the Health Commissioner added that the State is required to bear the financial burden of the listed projects up to 40 percent as part of the counterpart funding.
KEHINDE AKINTOLA, Abuja
