Fresh Debts: DMO Uncovers N226.8bn Borrowings By 13 Governors In 6 Months

Fresh Debts: DMO Uncovers N226.8bn Borrowings By 13 Governors In 6 Months....KINDLY READ THE FULL STORY HERE▶

During their initial six months in office, a collective sum of N226.8 billion was borrowed by 13 newly inaugurated state governors from both local and foreign lenders, according to findings by Sunday PUNCH. Additionally, the debt profiles of 16 state governors increased by N509.3 billion, comprised of N243.95 billion from domestic sources and $298.5 million (equivalent to N265.37 billion) from external sources.

The calculation of external debt utilized an exchange rate of N889 per dollar, as per the Debt Management Office’s report, which emerged from an analysis of the most recent sub-national debt reports.

Sub-national debts are classified into domestic borrowings from local creditors and external borrowings from international entities such as the World Bank and the International Monetary Fund. Data regarding domestic and external debts were extracted from the DMO’s website and pertain to figures as of December 30 and June 30, 2023, respectively.

The borrowing states, including Benue, Cross River, Katsina, Niger, Plateau, Rivers, Zamfara, and the Federal Capital Territory, accrued N115.57 billion from domestic creditors. Additionally, governors from Ebonyi, Kaduna, Kano, Niger, Plateau, Sokoto, Taraba, and Zamfara secured $125.1 million (N111.24 billion) from external sources.

Further examination of the data for the sub-national entities revealed significant borrowing patterns. For instance, Cross River Governor, Bassey Otu, obtained the highest loan amounting to N16.2 billion from domestic lenders and $57.95 million from foreign creditors between June and December 2023.

Katsina State’s debt increased substantially by N36.93 billion from N62.37 billion to N99.3 billion by December 2023. Similarly, Niger State’s domestic debt surged from N121.95 billion in June 2023 to N139.8 billion by December of the same year, amounting to N17.85 billion.

Plateau, Rivers, Zamfara, and the Federal Capital Territory, under the leadership of Nyesom Wike, also borrowed N16.32 billion, N7.07 billion, N14.26 billion, and N6.75 billion, respectively, from domestic creditors.

On the foreign debt front, Governor Francis Nwifuru of Ebonyi State accumulated an external debt of $37.54 million, while Governor Uba Sani of Kaduna State secured $17.69 million from external financiers. Additionally, other states such as Kano, Niger, Plateau, Sokoto, Taraba, and Zamfara also engaged in external borrowing.

Despite prior assertions by the administration of President Bola Tinubu that it would diverge from the extensive borrowing practices of its predecessor to fund expenditures, recent developments indicate a continuation of this policy amidst heightened revenue. In 2023, state governors received the highest allocations from the Federal Account Allocation Committee in at least seven years, attributed to the removal of petrol subsidies and currency reforms instituted by the Tinubu administration, reportedly resulting in a 40% income boost.

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