Governor Seyi Makinde on Friday defended the approval of N63.4 billion by the Oyo state Executive Council for the overhauling of the Government House.
Speaking during the presentation of the State of State Address at the House of Assembly, Ibadan, the governor said it was as a result of the fluctuating exchange rate of Naira to Dollars.
He said the state was “currently grappling with a steep increase in its foreign debt repayment obligations, which have ballooned from ₦70 billion to over ₦300 billion, due to exchange rate volatility.”
According to the governor, the root of the debt was a $200 million loan obtained from the World Bank during the twilight of the administration of late Governor Abiola Ajimobi.
He maintained that at the time the loan was secured, the exchange rate stood at ₦350 to a dollar, bringing its naira equivalent to approximately ₦70 billion.
“Today, because of the steady depreciation of the naira since 2019, we are now servicing the same loan at a valuation of over ₦300 billion.
“When we assumed office, our monthly repayment stood at ₦700 million. But as of now, we are compelled to pay ₦3 billion monthly.
“As a sub-national, Oyo state has absolutely no influence on exchange rate decisions. Yet, we bear the consequences in our fiscal planning,” he said.