The federal government on Wednesday approved $200m World Bank loan for Lagos state.
This was disclosed in a briefing by the Minister of Information and Culture, Alhaji Lai Mohammed; and the Minister of Power, Works and Housing, Mr. Babatunde Fashola, at the end of the meeting presided over by President Muhammadu Buhari
Mr. Babatunde Fasola said that the loan would enable the state government to meet its infrastructural needs, complete some if its ambitious projects, such as the 61Km 10-lane Lagos-Badagry Express way and rehabilitate the inner roads in Apapa in addition to some other major ongoing works.
Fasola who is the immediate past governor of the State said that the loan was initially $600 million, revealing that the agreement was made in 2011 and that the facility was not a new loan but a segment of a programme of developmental initiatives which had initially been approved for Lagos State.
According to him, the money was meant to be disbursed in tranches of $200m each year from 2011 to 2013, but suffered delays due to political differences between the state government and the previous PDP led federal government.
“… it suffered delays as a result of partisan political differences in the last dispensation. After the first tranch was disbursed, there was a freeze on the second tranch. The initial agreements we had with the World Bank was a 40-year loan, a 10-year moratorium, 0.5 percent interest. But because of the delays that subsequently characterised the partisan interference that took place, our profile as a nation also changed.
We had become a bigger economy although money was being lent to us not now as a highly indebted nation anymore. So by the time this one was approved now because of the delays, we had lost the opportunity of 40 years as it is now a loan of 25 years.”
“The moratorium has reduced to five years instead of 10 years. The interest rate had gone up to 2.5 percent, but what is still heart-warning about it is that it helps to finance infrastructure.
Fasola expressed gratitude to the present government of President Muhammed Buhari for facilitating the process stating that the loan would make life easy for the people'”
The minister was asked why an APC-controlled state is the first beneficiary and he had this to say:
“I mentioned partisan differences because I remember when the delays came up, I was told by the then Minister of Finance that she was getting complaints from PDP Governors that it was only APC states that were benefiting at the time from the World Bank loans. So we got access when we were in opposition, because we qualified and we met the competitive conditions and one of the resolutions we have taken is that we must encourage other states who meet these kinds of conditions across the party lines to be able to access them, because it is competition that really brings productivity.”