By Agboola Bayo
Ibadan
Vice President, Professor Yemi Osinbajo, at the weekend, hinted that the federal government has negotiated with commercial banks to convert debts owed them by state governments in the country to bonds for easy repayment.
He dropped this hint in Ibadan during a chat with journalists shortly after attending the 90th birthday service of Mrs. Mojisola Adedayo, held at the Cathedral of St James Oke Bola, Ibadan.
According to Osinbajo, under the new arrangement, commercial banks would be expected to spread the
debts converted into bonds for over a long period.
He stressed that this was part of the measures put in place by the President Mohammadu Buhari-led government at easing access of loan by state governments at a concessionary rates to reduce the burden on the borrower states.
Osinbajo stressed the need for states, presently, owing workers salaries to explore the opportunity by accessing the concessionary loan through the CBN adding that the present All Progressives Congress (APC) government in Nigeria had considered the plight of states in the country through the about 40 percent reduction in allocation which has prevented them from meeting their financial need.
“As you know, the Federal Government under President Buhari directed that three things should be done regarding the situation of the states in Nigeria.
“We know that the states were unable to pay salaries of their workers for many months. The first stage was the sum of money that was shared from the Nigeria Liquefied Natural Gas dividends and taxes, amounting to $2.1b.
“The second package is a loan which the states are allowed to access. The loans are concessionary in nature and any state that deserves it should have it. The third stage is the conversion of loans owed to commercial banks by the states to bonds. It is fairly complicated but simply put, the state and FG will work out how the loan will be repaid over an extended period of time. We are looking at 15 to 20-year period,” he said.
Speaking further, the Vice President, while clarifying his recent statement on the plan by the Boko Haram insurgents to hit their targets using scavengers, asked Nigerians to be vigilant so as not to fall into the dangerous plot of the sect saying, he only warned that the VIPs in the country were being aimed by the insurgents and not the Vice President