#TrackNigeria: The Debt Management Office states that the debt stock of the 36 states and the Federal Capital Territory (FCT) stood at about N6.8 trillion as at March 31
According to it, the figure includes both the domestic and external debts and it bases the findings on the collations done December 2018.
Economists express worry about this and observe that critical debt burden can be a threat to the country’s economy, governance and the expected dividends of democracy, especially when the loans are not tied to viable development programmes.
For instance, an overview of debt profiles indicates that Lagos State has a domestic debt stock of N542.2 billion and external debt of $1.426 billion (N513.5 billion) while Kano State has a domestic debt stock N117 billion and $63.4 million as at March 31.
Similarly, Rivers owes N225.6 billion domestic loan burden and $78 million external loan, FCT gets N164.2 billion (domestic) and $31.8 million as external debt.
Anambra has N33.5 billion (domestic) and $107 million (external) while Akwa Ibom has N197 billion as domestic debt and $46 million and Ebonyi; N55.6 billion (domestic) and $66.3 million dollars (external), to mention few of the states.
The DMO also expresses concern about the debt profile across the states which economists admit that can retard the provision of capital projects.
However, analysts observe that the debts are accumulation of debts owed by successive governments of every state in the federation for which no governor has been held accountable.
Alhaji Aliyu Numan, Chairman, Adamawa Transition Committee, says that it is disheartening that previous administrations had accumulated debts without anything to show for it.
He announces that the total debt burden of the state during the period stands at N115 billion and that N22.3 billion is used to settle claims to contractors whereas the reasons for the loan is to pay salary arrears, staff claims as well as gratuity, among others.
“Government at that time failed to create businesses for the state and even resorted to the sales of state owned assets to service personal interest of few.
“Monies and allocations which should have been used to address basic services such as potable water, education, health and housing, were simply not available,’’ Numan says.
Similarly, Gombe State Government says it inherits a debt burden of N119 billion, according to Malam Ismaila Misilli, the Senior Special Assistance, Media and Publicity to Gov. Inuwa Yahaya of the state.
Misilli observes that in spite of the huge debt, nobody could pin-point a single project which is people-oriented executed with the loans.
NAN recalls that the Kaduna State government in 2016 sought a $350 million World Bank loan — about N107 billion — for infrastructural development.
But the then Senate Committee on Local and Foreign Debt, led by Sen. Shehu Sani, former Senator Representing Kaduna Central advised the Senate then against approving the loan.
According to the committee, if the loan is granted, it can bring the state’s total external debt stock to $582 million, a development which the committee argued will translate to huge financial burden on the state.
The Anambra government would not comment of the state’s profile. Mr C-Don Adinuba, the state Commissioner for Information and Public Enlightenment and Mr Mark Okoye in the Budget and Economic Planning office of the state, decline comments.
Although the Enugu State government also declines comments on the states’ debt profile, Gov. Emeka Ihedioha of Imo notes, that the state is with N106.11 billion debt without anything to show for it by the past administrations.
“Instances of suspicious withdrawing of cash from government accounts in commercial banks without due processes as well as illegal recruitment and promotion of civil servants were a common practice by past administrations.
“Unsustainable debts were incurred on behalf of the state running to more than a N100 billion without anything to show for it and consequently saddling the state with a myriad of lawsuits’’, Ihedioha says.
Mr Adelani Baderinwa, the Supervisor for the Ministry of Information and Strategy in Osun, admits that the debt profile of the state as released by NBS stands at N148 billion but a bulk of the debt has been paid in July.
Baderinwa gives an assurance that the rest of the debt will be paid by 2020 and that the loans are taken to execute developmental projects in the state.
He claims that the loans are used to revamp the education, health sectors, the rehabilitation and construction of new roads across the state.
The debt profile in Ogun is put at N90 billion (internal) and $102 million (external) announced by former Gov. Ibikunle Amosun of the state at the twilight of his administration in May.
Analysis of how the loan is used indicates that most of it is for the construction of Ogun Judicial Complex; the 10,000-seater capacity Amphitheatre at Oke-Ilewo, the Kampala/Adire Mall at Itoku, the Ogun Television Digital Studio and the 250-bed ultra-modern hospital at Oke-Mosan.
The incumbent Gov. Dapo Abiodun has kept sealed lips over the amount of debt he inherits from the Ibikunle Amosun-led administration.
He, nonetheless, said in June at a meeting with leaders of the All Progressives Congress (APC) in the state that he met “an almost empty treasury’’.
He noted that he had to quickly approach some banks where he got N7 billion loan to pay May salaries of workers.
“We have by far too many things to do than to begin to be bugged down by what someone did or what he did not do or what he left behind.
“I cannot begin to describe it to you. I will not because I have made up my mind that publicly and privately, I will not discuss anything about the past administration,’’ he said.
The DMO record shows that the Ondo State government has a debt of N56.9 billion as at March 2019.
A government source, who pleads anonymity, says that Gov. Oluwarotimi Akeredolu has not borrowed any sum since he came on board in 2017.
He, however, says that the governor recently sent a request to the state House of Assembly for approval to borrow N30 billion which has not been approved.
In Kano State, DMO records N117 billion (internal and $63.4 million (external) as the state’s debt profile.
An official of the state’s treasury department says the state is has more than N200 billion vouchers to pay to individuals and companies.
“The bulk of the debt are liabilities that are abandoned projects scattered across the state, including 92 abandoned road projects in the municipal area.
“Top in the list of abandoned project are the two kilometre Sabon Gari flyover, Wuju Wuju Jakara road projects, Gadon Kaya Under-pass road projects and five kilometre road construction in each of the 44 local government areas,’’ he notes.
Others states with worrisome debt burdens are Bauchi State N92.3 billion as domestic and $133 million (about N48.2 billion) as external debt, Bayelsa N130 billion as domestic debt and $56.6 million as external, Benue N97.3 billion as domestic and $39.6 million (external), Borno N68.4 billion (domestic) and $21.6 million (external), Cross River N168 billion (domestic) and $188.8 million (external) and Delta N228.2 billion (domestic) and $63 million as external.
Katsina State has N30.8 billion and $62 million domestic and external respectively, Kebbi N67.4 billion and $45.6 million, Kogi N85 billion and $31.5 million, Kwara N59 billion and $48.6 million, Nasarawa N85.5 billion and $59.1 million and Niger N41.8 billion and $61.3 million.
Rivers has a debt profile of N225.6 billion and $78 million, Sokoto; N38.6 billion and $39.2million, Taraba N61.5 billion and $21.6 million, Yobe N28 billion and $27.5 million and Zamfara N60 billion and $33.5million.
In all these states, the complaints have been that the loans have not been utilised for the purposes they are borrowed.
Dr Uche Olowu, President and Chairman of Council, Chartered Institute of Bankers of Nigeria, however, observes that although states are bound to obtain loans, but such loan shoulds be used for development projects.(NANFeatures)
This is News Agency of Nigeria (NAN’s) in-depth report on debt profiles of some states and analyses how the debt has affected the delivery of dividends of democracy as the country marks the 59th year of independence.
