Ogun govt defends $350m World Bank loan quest

The Ogun State Government on Monday explained why it approached the World Bank to secure a $350m loan.

Addressing a joint press conference at the Governor’s office, Oke-Mosan, Abeokuta, the Commissioner for Budget and Planning, Mrs. Adenrele Adesina; and her counterparts in ministries of Education, Science and Technology, Health, Works and Infrastructure, Commerce and Industry and Urban and Physical Planning said the House Committee on Loans/Aids/Debt Management did not reject the proposal for the loan request.

It will be recalled that the representatives of the Ogun State Government, led by Adesina, had, on Wednesday sought the approval of the National Assembly, being part of the requirements for granting of the loan.

Adesina said the state started processing the loan in 2014, “given the phenomenal infrastructural development in the state (which made it) an “attractive bride” to the World Bank.

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She said, “World Bank considers states that have demonstrated ability to perform and partners such states in development.”

She further explained that any serious government desirous of development ‎should take advantage of such facility, which she described as a concessionary loan offered at two per cent interest rate.

“The loan attracts just two per cent interest, as against the 22 per cent ‎obtainable in the normal financial market.

“The loan is also payable over a period of 25 years with a five-year moratorium, which means that we have about 30 years to pay back.

“‎It will be foolhardy for any government to reject such an attractive offer.”

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Adesina noted that the loan was different from conventional loan where the full amount being sought would be disbursed at once.

She stated that disbursement would be made in tranches, based on performance.

Adesina added that the highest that the present administration in the state could get was a maximum of 25 per cent.

She added, “This is a loan mainly for the future, as the subsequent administrations in the state stand to benefit more as more tranches are disbursed in the course of time.

“It will therefore be misleading to claim that the loan is meant just for the present administration.”

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