Business
Senate Cautions Govts Against Foreign Loans
The Senate Committee on Local and Foreign Debts, has
urged state governments to desist from unwarranted foreign loans to avoid
creating debt burden for future generations.
The
Chairman of the committee, Senator Ehigie Uzamere, gave the advice in Abuja on
Monday during the budget defence on States’ External borrowing plans.
Uzamere
advised state governments to shun any external financial borrowing plans that
would undermine the future of the people. He said the Senate was worried
because the foreign loans being sought for by most states were not for projects
that would directly benefit the people.
“It
is very sad the way we are going in this country, especially, in terms of
borrowing. Our children yet unborn must not suffer from what they don’t know
anything about.
“When
we approve these loans, our committee will visit the states to see what the
governors are doing with the loans,’’ he said.
A
member of the committee, Senator Gbenga Obadara (ACN- Ogun), advised the states
to ensure that their borrowing plans targeted those areas that would cater for
the needs of the masses.
“There
is no reason for any state to over-borrow. The governors must think of people
that will pay the debt in 10 years’ time.
“We,
as lawmakers, find it difficult to see the states in debt trap. We have states
seeking 100 million dollars.
“Their
debt will continue to pile up. One per cent of loan interest today will become
very huge in 10 years’ time. “We should shun reckless borrowing as much as
possible. Our committee, therefore, advise state governors to cut their cloths
according to their sizes,’’ Obadara added. The Ondo State Commissioner for
Finance, Mr Yele Ogundipe, had presented a 50 million dollars loan request for
health programmes and another 27.9 million dollars for youth employment. The
Enugu State Commissioner for Finance, Mr Ralph Nnaji, submitted a request of 50
million dollars loan for watershed management project, 40 million dollars for
youth empowerment and another 40 million dollars for energy project.
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