INGRA raises concern over Kogi huge debt profile

INGRA raises concern over Kogi huge debt profile

An activists, Mr. Hamza Aliyu has raised concern over the debt profile of Kogi state calling on the state government to as a matter of urgency make clarification.
Hamza who is the Executive Director, INGRA said the debt profile of the state, has published recently published by the Debt Management Office, (DMO) is quite disturbing; necessitating a need for accountability and transparency from the state government.
He said, “According to the Debt Management Office (DMO), the statutory body responsible for coordinating the debt management for Nigeria and all its sub national entities, the external debt profile of Kogi State as at 31 December 2020, stood at  US$30,157,822.27. By the Central Bank of Nigeria (CBN) rate of N380/$1, this translates to N 11,459,972,462.6.
“At the same, the domestic debt stood at N68,092,548,068.84 (Sixty-eight Billion Ninety-two Million five hundred and forty-eight thousand Sixty-eight Naira eighty-four Kobo).
“This mean that the State is one of the least indebted states in the Nation. The Gross domestic Product of the State is put at US$4,642,000,000 (Four Billion Six hundred and forty-two million Dollars), thus the debt to GDP ratio of the State is very sound.
 “However, a cursory look at the data from the Debt Management Office showed the following observations; that the External debt of the state has been flat, The total Domestic debt as at December 2015 stood at N42,034,626,226.84. By 31st December 2016, the debt had risen by over 69%  to N71,381,258,449.39, jumped to N102, 359,193,069.66, rose to N114,332,341,233.39 by June 30, 2018
“The year 2019 saw a spike in domestic borrowings resulting in N47,542,285,710.34 added to the debt which stood at N 132,464,662,160.12. This was the highest single year borrowings for the state
“Data showed that in 2020, there began a series of reduction in the domestic debt which climaxed in June 2020 with single largest reduction between March and June 2020 by N55,602,708,599.62
“It’s surprising that in the very first 2 years of this administration (2016-2017), there was an almost N60B rise in the Domestic debts. This is despite the fact that there should have been a SURPLUS in Budgets. What where the borrowings for and from whom were these borrowings from? Was there Public Hearings by the Kogi State House of Assembly to provide information to the citizens on the need for these borrowings?
“2019 (an election year), witnessed the highest borrowings in this administration. This is strange as the tradition had always been for Banks not to give loans until after elections. The borrowings are almost two-third  of the state total REVENUE.
“Repayment of borrowings in 2020 was extra ordinary with the March-June 2020 representing the largest single repayment period in the history of this administration. A whooping N64Billion was paid back in 2020 alone. Thats more than what all the Ministries Departments and Agencies spent on CAPITAL in the last 2 previous years. These domestic borrowing are huge despite the near absence of infrastructure in the state.
“There is need for the Ministry of Finance Budget and Planning to urgently provide clarifications on these issues.
“There is limited transparency in the debt management of the State. There must be a consistent effort by the Government to provide platforms for discussions about the State Debt profile.
“The House of Assembly Committee on Public Accounts must live up to its Constitutional obligations of effective oversight to ensure that Kogi State citizens get value for money; There must be a document from the Ministry of Finance budget and Planning stating the borrowing and what the funds where used for and the status of the projects.
“With no roads, water, light and food insecurity, it is urgent for the government to show what these funds where used for and why the state should be making repayments for funds not used for them.”

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