Are these states just plain stupid or what .
By Okon Bassey
In order to douse the tension
currently brewing in Akwa Ibom
State, the state government
at the weekend explained that
its decision to borrow the sum
of N80 billion from a foreign
bank, London Standard
Chartered Bank International,
was not an indication that the
state was broke.
It said rather such approval
from the international financial
community was an
endorsement of financial
prudence and transparency of
the state.
The state Commissioner for
Finance, Mr. Bassey Albert
Akpan, who threw more light
on the loan facility while
briefing journalists in the
state, argued that it was even
more reasonable and
productive to borrow from the
international market than local
market.
According to him: “It is good
to state that when a
government borrows, it is not
that the government is broke.
You are borrowing to finance
your cash flow because if you
have to depend on your
monthly allocation, it means
most of the projects would
not have been completed.
“We have run this state for
five years without borrowing a
dime from any bank. We have
also run this state for five
years and have paid back
every simple bankable loan
that we inherited from the
immediate past administration
in the state. We have also run
this state for five years and
we have cleared every liability
in terms of contractual
liabilities that we inherited
from the past
administration.”
Akpan, who regretted the
spate of criticism trailing the
proposal for the state to
borrow N80 billion, maintained
that the state government
should rather be commended
for what it had achieved in the
past five years in office
without borrowing.
“I think it is something we
should talk about that if the
government has achieved this
much in the past five years
without a single bank loan, I
think it should be commended.
"
“As I am talking to you, by
May this year, once the
government approves, we
would start the inauguration
of over 700 projects spread
across various local
government areas in the
state,” he stressed.
According to the
commissioner, the N80 billion
loan is to pay the outstanding
of the N50billion earlier
borrowed by the state
government from the United
Bank for African (UBA) last
year.
The UBA, he said, gave N50
billion loan to the state
government last year at an
interest rate of 18.5 per cent
per annum while the N80 billion
to be obtained from the
Standard Chartered Bank
International attracts 8.1 per
cent interest rate per annum.
“When we consummated the
UBA facility, we were also
working with international
financial institution because
the real essence is to bring
governance at the cheapest
rate to the people. We were
also working based on the
interest that was shown by
the international financial
institution based on the
performance of the governor.
“The UBA facility was meant
to be a stop-gap because
borrowing from local market
was far easier than borrowing
from international market.
Akpan insisted that the UBA
facility was a double digit
facility at 18.5 per cent
interest rate per annum while
at the same time the state
government is also working
with international bank where
the interest rate is about 8.1
per cent interest rate per
annum; saying the “UBA
facility was a bridge to
support the state as at the
time it came.”

80 billion / 3 million = 26,666 Naira

pdp mortgaging the future of a state