We have to rise against the excessiveness of the Ikpeazu led Abia State government. The financial imprudence of the government will leave Abia State with zero FAAC Allocation by 2023 if not resisted.
We gathered from a reliable CBN source that Ikpeazu’s government is at the verge of taking a $200 million, (N72 billion) loan from the bond market ostensibly for infrastructural development. Mr Chinedum Orji led Abia State House of Assembly has approved the loan.
It is outrageous because Abia State has external debt stock of $100.2 million, an equivalent of N36,078 billion and domestic debt of N57.467 billion respectively.
From the current monthly repayment plan of N42.1 million deducts from our FAAC allocation by the CBN, it will take Abia State approximately 70-years to repay our current external debt stock of $100.2 million.
The $200 million grant will escalate our external debt stock to $300.2 million (N108.72 billion). In other words, Ikpeazu’s government is at the verge of incurring a loan that will take Abia State 210-years to repay going by the current CBN repayment monthly plan of N42.1 million.
CBN is also deducting the sum of N403.8 million monthly from Abia FAAC allocation for the repayment of an internal loan of N57.467 billion incurred by Ikpeazu’s government.
These deductions have forced Ikpeazu to resort to short term loan (that goes with a high-interest rate) from banks to run the government.
Before this, indices of financial reports from NBS, DMO and BudgIT State of States Growth in IGR versus Growth in External Debts showed that Abia State economy is in comatose.
Statistically, Abia is currently ranked number one state that her external debt growth rate is astronomically higher than the IGR growth rate.
According to the analysis, Abia State’s IGR growth is just 17.51 per cent compare to its external debt growth of 145.79 per cent.
So how do we repay another loan of $200 million when we are struggling to offset $100.2 million hanging on our neck?
What is Ikpeazu’s government doing with Abia funds? In 2019 alone, Jan – July, it received the net FAAC allocation of N41.8 billion.
If added to the N41.553 billion in 2015 (May-Dec), N50.605 billion in 2016 (Jan-Dec), N66.815 billion in 2017 (Jan-Dec) and N89.21 billion in 2018 (Jan-Dec) it amounts to N289.983 billion FAAC allocations received by Ikpeazu’s government in 50 months. (four years and two months).
Where are the infrastructures developed with this money?
Ikpeazu’s government received the sum of N22 billion from Paris Club Refunds alone (N10.6 billion, N5.7 billion and N5.7 billion being first, second and third tranches.
It also received N14.2 billion in bailouts, which the state government quickly took advantage of to renegotiate its liabilities, including taking a 20-year loan of N14.15 billion at a nine per cent lending rate from the CBN ostensibly for the settlement of outstanding wage bills, still workers and pensioners are owed backlogs of salaries and pension allowances.
Ikpeazu’s government has also received a total IGR of N56.266 billion from May 2015 to Dec 2018 (N105m in 2015, N14.92b in 2016, N12.69b in 2017 and N29.1b in 2018).
Also, during the election tribunal, Appeal and Supreme Courts cases in 2015; Ikpeazu’s government borrowed N43.02 billion from an unnamed financial institution.
In other words, Ikpeazu’s government generated a total sum of N439. 619 billion from Federal allocations, IGR, Paris club refunds/bailout funds as well as accumulated a debt stock of N100 billion in its 50 months in office, still, nothing to show for it to justify another $200 million loan.
From next month, the Federal Government will begin the deduction from the source, its bailout to Abia State. How will the state survive?
I urge the Abia elites to petition the FG to stop the $200 million loan that will escalate our external debt stock to $300 million.
Ikpeazu’s government wants to nail the Abia’s casket.
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