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Group lambasts Akwa Ibom Governor over high debt profile

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Group lambasts Akwa Ibom Governor over high debt profile

A civil society group working on financial justice, Policy Alert has raised the alarm over the increasing debt profile and high rates of borrowing by the Akwa Ibom State Government.

Recall that the Akwa Ibom State House of Assembly lately approved N7bn loan request by Governor Udom Emmanuel for Agriculture and Housing projects.

However, in a statement on Tuesday by the Communications and Stakeholder Engagement Officer of Policy Alert, Nneka Luke-Ndumere, the group criticised the Governor over his decision to engage in loan acquisition in spite of the state’s alarming debt state.

The statement read in part, “The state government failed in its fiscal responsibility by not providing these prerequisites for loan acquisition and the House of Assembly on its part failed in its responsibility by approving the loan request without interrogating it against the provisions of a law it made recently.

“We must understand that there is a very questionable trend of loan acquisition in the state which makes the debt profile of the state very close to unsustainability because these loans are not self-liquidating. Instead, the state pays hugely for interest on these loans.

“Do not forget that the state in 2019 which was an election year acquired loans to the tune of N48 billion and in 2020 acquired N7.8 billion. Now, in just half part of the year, N7 billion has been approved for acquisition. You can now predict the expected trend before the end of the fiscal year. We cannot continue with this trend of frivolous loan acquisitions.”

The group also expressed concern that all the loans are taken from commercial banks at non-concessional rates, a state that would finally translate to huge debt burden to successive governments and generations.

Policy Alert called on State House of Assembly to redeem its image by reviewing its current decision on the approval of loan.

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