Abia’s Debt Profile: The True Position

By Obinna Oriaku on 27/11/2018

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By Obinna Oriaku

My attention has been drawn to the blatantly false figures of the Abia debt stock conjured up and being peddled by some mischief makers driven by malice who are bent on misleading their gullible followers on the state of Abia debt portfolio. Such falsehood is nothing but only a product of the warped figment of the imagination of its authors who must have been recruited by desperate unscrupulous politicians.

Ordinarily, one would not have responded to the hate-inspired publication but as the driver of the Abia State Ministry of Finance, in this open, frugal and transparent government, it behoves on me to respond appropriately with a view to setting the records straight.

First and foremost, it is imperative to state at this point that a critical and surgical perusal of the Debt Stock of Abia State as at September 2018, as verifiable at the DMO office, lends veritable credence to the judicious financial management and frugality of the current administration.

The fictitious figures being bandied about by naysayers, detractors and self-ordained enemies of the State Government, worry the ordinary Abian and remain inconsistent with conventional wisdom. To say that Abia's corrigible debt will take a 210 year-term to offset, in the name of politics, self-promotion or shopping for relevance, remains the apogee of skulduggery. It is similar to making an intentional voodoo inroads against the collective will and good of Ndi Abia. No doubt, the resentful soul propelling such mendacious news can go any length to want to make it become real so that his sophistry can, at least, appear like truth, and his intentions have a glimmer of honesty, therefore, attempt to justify his highly jaundiced position. But no matter how much they try, their efforts will always remain vain, puerile, facile and jejune.

Let us take a clear look at the debt stock of Abia State and the components (debt categories) that make it up:

A. DEBT STOCK AS AT 2014
i. Debt Stock = N25,126,070,685.10
ii. Debt Service = N977,671,142.80
TOTAL DEBT STOCK = N24,148,399,542.30

B. DEBT STOCK AS AT 2015
i. Debt Stock = N33,530,526,404.80
ii. Debt Service = N15,068,996,133.70
TOTAL DEBT STOCK = N18,461,630,271.10

C. DEBT STOCK AS AT 2016
i. Debt Stock = N53,525,312,006.52
ii. Debt Service = N8,202,484,003.26
TOTAL DEBT STOCK = N45,322,827,923.26

D. DEBT STOCK AS AT 2017 
i. Debt Stock = N60,648,431,912.05
ii. Debt Service = N8,578,365,685.37
TOTAL DEBT STOCK = N52,070,066,226.68

E. DEBT STOCK AS AT 2018 (SEPTEMBER) 
i. Debt Stock = N74,791,876,604.80
ii. Debt Service = N6,145,035,586.01
TOTAL DEBT STOCK N68,646,841,018.79

It is also necessary to note the debt categories of the debt stock of Abia State.

DEBT CATEGORY

1. Budget Support Facility = N15,169,000,000.00
2. Bailout Funds = N12,601,854,171.08 
3. Restructured Commercial Bank Loans = N4,428,096,782,46
4. Excess Crude Account = N8,720,030,857.51
5. Commercial Bank Loan = N8,828,099,126.50
6. Agriculture Loan = N199,929,947.77
7. Contractors' Arrears = N988,612,735.97
8. Pension and Gratuity = N20,208,779,379.37

Note the following:
i. Debt Service is made up of the principal repayments which we pay alongside running interests for such debt categories with interest element.

ii. Gratuity and pension stood at about N37b before the inception of this administration.

iii. Budget support of N15,169,000,000 was admitted in the third quarter of 2018 as a loan to the State.

However, we thank God Almighty for the directional and visionary leadership of Governor Okezie Ikpeazu PhD as it is very obvious that Abia under his leadership has grown beyond such petty minions, leaving men like the fake news propeller behind as the governor has refused to fall for their many tricks and join the bandwagon.

Should we extrapolate Abia pension and gratuity bills which we have reduced from N37bn in 2003 record to about N20bn as at September 2018, the sincerity of our regime towards offsetting accumulated debt of previous administrations is not in doubt. If we then take the pattern a step further by extrapolating Budget Support Facility of 15,169,000,000.00 which FG just added to us as a loan by the 3rd quarter of 2018, then people will appreciate even further the messianic efforts of the Ikpeazu administration in maintaining uncommon equilibria and balancing in the fiscal management pf the State’s resources. Assuming there was no borrowing from the excess crude account which was stopped before this administration came on board, Abians would better know what exactly the State is owing.

However, since government remains a continuum, we take responsibility of servicing all outstanding debts; but these should not been blown out of reasonable proportions by petty and hired undertakers parading themselves as opposition.

-Obinna Oriaku, a seasoned banker, is the current Commissioner for Finance in Abia State

 

 

Posted on November, 27 2018

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