The Lagos State Government has defended the N225bn it raised through the bond market, saying it is to meet the infrastructural needs of the state.The Commissioner for Finance, Dr. Mustapha Akinkunmi, made the statement on Tuesday, at a meeting of government officials with stakeholders on the combined bonds the state took from the capital market.
The bonds were issued in three tranches of N57.5bn, N80bn and N87.5bn.
The commissioner said, “Some of the projects implemented with the bonds are the Jetty and Terminal Building at Badore and Osborne; Maternal and Child Centres at Epe and Badagry, the construction of Lagos HOMs, renovation of schools, rehabilitation and provision of some arterial and inner roads.
“The magnitude of the projects necessitated the significant capital expenditure on an average of N225bn over the last five years, which has been funded by recurrent receipts augmented by capital borrowing.
“The state has displayed fiscal sustainability and financial independence in maintaining international acceptable thresholds on its debt sustainability position in all the key parameters, using both the Fiscal Responsibility Act as well as the Country Policy and Institutional Assessment benchmarks of the World Bank for developing economies.”
Assuring the bond holders that the government would always justify its borrowings with visible and commensurate infrastructure, the commissioner sought the support of investors in the drive to lift the state to greater heights.
Akinkunmi maintained that the state had a strong rating based on a record of disciplined debt sustainability and prudent financial management certified by professional rating organisations like the Fitch Ratings.
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