Imo State government has denied that its current debt profile is N100billion. The state put its indebtedness at less than N10billion.
The Central Bank of Nigeria (CBN) through its Debt Management Office (DMO) is reported to have declared the state insolvent owing to its burgeoning debt profile which makes the state unfit to borrow more money from domestic and external sources.
But briefing newsmen on Wednesday in Owerri, State Commissioner for Finance, Deacon Chike Okafor gave the state a clean bill of financial health.
He put the state’s current debt profile at less than N10billion, even as he stated that the incumbent administration headed by Owelle Rochas Okorocha has been servicing the state’s loan including the ones inherited from previous administration.
Okafor informed that the state’s debt as at today comprises a seven-year N18.5billion fixed rate bond obtained by the previous administration in 2009 and N6billion, also obtained by the previous administration two months to its expiration from a commercial bank.
According to him, the current administration has repaid a total of N17.69billion (plus interest) to the bondholders leaving a balance of N12billion (plus interest) outstanding while it has had to refinance the N6billion loan through another commercial bank.
He said the state has been prompt in servicing these loans and has not defaulted, adding that before a state could be classified as unfit to borrow, there has to be a consistent inability to meet its obligations as they fall due.
The commissioner maintained that the CBN cannot work in isolation but must be communicated to by the state’s bankers before it could arrive at any conclusion about the state’s financial health.
He declared as a deliberate distortion of facts to suggest that the DMO of CBN had classified the state as unfit for further borrowing, pointing out that it is a calculated attempt to smear the superlative achievements of Gov. Okorocha in the last two years.
Okafor submitted that a recent categorization of state governments and their solvency position never mentioned Imo State as getting a DMO warning on its debt profile.
The commissioner informed that by a recent DMO publication, the Imo State external debt stocks represent about 1.94% and wondered where the rumour peddlers got their figures from.
Okafor stated that the administration has significantly increased the state’s internally generated revenue from N350million monthly to N700million monthly to augment its federal allocation.
This increment, he said, has greatly helped the administration to meet its recurrent obligations and carry out the massive developmental projects in the state.
Okafor restated that the state is healthy financially, adding that the administration was committed to delivering democracy dividends to the people.
Courtesy: Gele Agbai
