Fed Govt, states to borrow $7.9b in 2013

Federal and State governments yesterday defended their requests for approval to borrow over $7.9 billion at the Senate.
Out of the amount, the Federal Government is seeking Senate’s nod to borrow $4,846.3 billion while some state governments applied for approval for a loan of $3,059.39 billion.
Chairman, Senate Committee on Local and Foreign Debts, Senator Ehigie Uzamere, explained that the purpose of the loan defence was to know the amount federal and state governments applied to borrow.
Uzamere also said that his committee wanted to ensure that the loans were tied to specific projects.
He noted that it was necessary for the Senate to be fully briefed on the details of the loans to enable Senators take informed decision on the approval or otherwise of the loans.
He said that it was necessary for Nigerians to know what the loans were meant for.
Uzamere assured that his committee would do justice to the requests before writing its report for the consideration of the Senate.
Minister of State for Finance, Yerima Ngama said that the Ministry of Finance does not want to allow states to negotiate the terms of the loans.
Ngama noted that what the Minister of Finance and Coordinating Minister for the Economy, Mrs. Ngozi Okonjo-Iweala, did was to negotiate general terms of borrowing for states.
He said that a situation where states would be given verifying terms of repayment would not arise.
He said that it was not true that the loan portfolio of the country is high.
The minister, who noted that Okonjo-Iweala secured concessions for the loans, added that some of the loans were granted at zero per cent.
Commissioners of Finance of some states represented their states at the meeting.
Some of the loan benefiting states included Adamawa with a total sum of $54 million, Plateau $81 million, Abia $265million.
Other states that applied for the loan are Cross River , Kaduna , Kano , Lagos, Borno, Nasarawa, Ondo, Rivers, Ebonyi, Enugu , Bauchi, Yobe, Ekiti, Kebbi, Kwara, Kogi, Oyo, Ogun, Jigawa, Sokoto, Anambra, Katsin, Edo, Niger, Bayelsa and Delta.
Cross River, Kaduna, Kano, Lagos and Borno States are to benefit from $140 million growth and employment project loan while Adamawa, Ondo and Nasarawa will share $50 million state health programme investment credit at the of $16.67million each.
Abia,Anambra, Cross River, Ebonyi, Enugu and Imo States will benefit from $450 million erosion watershed management project loan while Abia, Adamawa, Bauchi, Yobe, Borno, Cross River, Ekiti, Enugu, Kano, Katsina, Kebbi, Kwara, Kogi, Niger, Imo, Ondo, Oyo and Ogun States will share $250 million youth employment and social support operations loan.
Katsina and Niger will share $75 million rural and mobility project phase 11 loan at the rate of $37.5 million each while Edo State will take the loan of $25 million for Edo State growth and employment support operation.
Cross River and the Federal Government will share $120 million urban water 2 additional financing at the ratio of Cross River $100 million, FGN (Federal Ministry of Water Resources $20 million.
Bauchi, Ekiti and Anambra States will share $150 million state education programme investment project.
Bayelsa, Delta, Edo and Rivers will share $200 million state employment and expenditure for result project at the ratio of Bayelsa $37.7m, Edo $45.02m, Rivers $61.63m, Delta $39.78m, FGN $7.8m, Ministry of Niger Delta $2.5m and NPC $5.3m.
Oyo State requested for $200 million flood and waste management loan project while the 36 States and Federal Capital Territory (FCT) will share $300 million agricultural operation loan project.
Under the Islamic Development Bank (IDB) loan, Kaduna State will take $44.69 million to upgrade hospital facilities. The state will also take $17.32 million four science secondary schools loan project.
Kaduna State will also take $136.34 million Zaria regional water supply while Niger will take $54.5 million Zungeru 700mw hydroelectric power project loan.
Adamawa , Niger , Kano , Kwara, Kaduna , Nasarawa, Gombe and Borno will share $70 million bilingual education programme loan.
Osun State will take $50 million dam project for water supply and irrigation loan, Yobe takes $40 million 200 bed ultra-modern hospital and equipping of primary health centres loan,
Yobe State is also to take another $80 million loan for Gashua water supply and Nguru water supply projects.
Kaduna State requested for approval of another $81.23million for Zaria water supply.
Under African Development Bank (ADB) funded loans, Kaduna State will take $1.23 million Zaria water supply loan while the state will take $56.61 million national urban water sector reforms loan from the French Development Agency (AFD) projects.
Under the Indian Credit Line projects, Enugu , Kaduna and Cross River States requested for $70 million power (energy project) loan.
Under the Exim Bank of China , the Federal Government wanted approval for $765.00 loan for Zungeru 700mw hydroelectric power project.
Some the loans has maturity period of 40 years, grace period of 10 years, service charge of 0.75 per cent and commitment charge of 0.50
The duration period for the projects is put five years.
Few have 13-year maturity period, grace period of two years, interest rate free and service charge not exceeding two per cent of total loan.
Abia State Commissioner of Finance, Sam Onuigbo told the committee that the state has been unable to access $200 million already approved for it while the Plateau State representative said that the state has not been able to access $50 million approved for it.
Culled: The Nation