The Oyo State House of Assembly On Wednesday granted the state Governor, Seyi Makinde, approval to borrow a N100 billion bond for his
government to finance priority projects in the State for rapid socio-economic development of the State.
The Assembly’s decision was in line with Makinde’s request for approval to borrow the bond. He had communicated to the Assembly few months ago and read at the plenary before the approval on Thursday, during plenary.
The Chairman, Assembly Committee on Finance and Appropriation, Hon. Akeem Mustapha, explained that due to the economic challenges, the state needed to get the financial instrument with a very low interest rate to further actualise the infrastructural development of the state.
Hon. Akeem Mustapha noted that the bond was intended by government to finance priority projects in the state for rapid socio-economic development of the State.
“During our workshop, there was a consensus opinion that there was nothing wrong in borrowing or bond issuance but what is important is the judicious utilization of the Bonds for the intended purpose. They are projects that have revenue potentials and capable of generating employment opportunities.
” The process towards the actualization of the proposed N100billion Bond commences November/December, 2020 as the target issuance date. Hence, all the five identified projects will be captured in the 2021 budget of the State.”
Mustapha said, “the bond is to be raised by the Private Company only that the government gives support to the investors that are to be involved in the Bond issuance.
Responding, the Speaker, Debo Ogundoyin, stated that upon receipt of the request, the Assembly had engaged in relevant consultations and held a seminar to highlight the benefits and challenges of bonds
with an assurance on the desirability of the facility. He added that the approval of the financial intervention would help sustain the state economy
He said, “There are needs for Government to seek and explore alternative means of financing its projects adding that borrowing itself was not a bad idea but insisted that money borrowed must be expended on capital projects that will generate revenue for easy and prompt repayment and not on recurrent expenditures.
“The House must be fully briefed on the bond. A committee will be setup in the house with members selected across Political parties irrespective to monitor the bond. It’s not a party affairs but a state business.
“The idea is to tap into our own potential as a state, so we can create our own success stories and commercial hub.” Hon Adebo Ogundoyin said.