The three Senators from Kaduna State on Thursday led the Nigerian Senate to refuse approval of a World Bank loan of $350 million for their home state of Kaduna.
Chairman of the Senate Committee on on Local and Foreign Debts, Shehu Sani, incidentally from Kaduna, and sworn political foe of Governor Nasir el Rufai, in his report to the Chamber said that the Committee recommended that the Senate reject the request of $350 million for Kaduna State as contained in the 2015 2018 External Borrowing (Rolling) Plan of the President, among others, because of the high total debt stock of Kaduna State.
The Kaduna government described the rejection as political vendetta to deprive the State of needed funds for development.
The three Senators from the State have been on a political warpath with the government. A factional office of the All Progressives Congress (APC) backed by Sani and Hunkuyi, and which building actually belonged to Hunkuyi, was demolished by the Kaduna government.
Said Sani on the floor: “…the new borrowing sought, will make the debt service to revenue ratio high, thereby worsening the state government’s ability to meet its other basic obligations to the people and further erode the economic viability of the state,” the committee said.
The Committee observed that, according to the latest Debt Management Office figures, Kaduna State has a total debt stock of $232.1 million, which would effectively rise $582.1 million.
It noted that “if this loan request is approved, the new total debt stock of $582.1 million for Kaduna State will be unsustainable and necessarily attract huge financial burden on the meager federal allocation to the state.”
Both Sani and Hunkuyi spoke to journalists later. Sani warned against any backdoor move to get the loan.
Said Sani: “Both the Senate and the House of Representatives must approve. Any other approval is void. So let me use this opportunity to call on the president as a strict man to the law as he has demonstrated with what happened in the APC by evacuating the so-called extension.
“So he must stand very firm. Any attempt by anybody to circumvent the National Assembly and collect money from the World Bank will be contrary to the law.
“I’m using this opportunity to call on the president and the World Bank country director in Nigeria, the minister of justice and the minister of finance to know that the Senate has rejected the $350 million loan request. Any attempt by anybody to circumvent this process, has simply done something else.”
“The request did not meet the development of critical infrastructural requirement in the state to help boost economic activities, the IGR potential of the state and the employment generation fund.”
Hunkuyi observed that the loan is to be drawn over a period of four to five years. “Interestingly, when we got the documents of draw-down and application for the loan, $170 million of the $350 million is to be drawn within one year; that is 2018. Why the rush? Why the hurry?
“Of all the 11 sections spread for draw-down of the $350 million, not a single section indicated practical application for funding of critical infrastructure. Lots of insinuations have been made but we stand firm, clear in our conscience with the interest of the people,” he added.