Akwa Ibom assembly approves Udom’s request to raise N150bn credit facility

Akwa Ibom assembly has passed a resolution authorizing Governor Udom Emmanuel to raise N150 billion loan facility from the money market for the funding of ongoing projects in the state.

Governor Emmanuel, in his request letter read at plenary, stated that the government would raise a “financial instrument” either through “promissory note discounting” or “direct credit substitute” to facilitate completion of the projects.

The governor told lawmakers that one advantage of the instrument was that it would not require Irrevocable Standing Payment Order (ISPO) or any guarantee, hence no monthly deduction would be made from federal allocations to the state.

When it was first reported that Governor Emmanuel would request permission from the assembly to get a N150 billion loan facility, many had wondered how the state government would defray the credit facility given that his tenure would terminate in less than 15 months from now.

However, Udo Kierian Akpan, the House leader who led the discussion on the governor’s request during plenary said the governor had assured that he intended to “create” the needed money within the money market, and not a loan.

Udo kierian said: “For me, the first thing the governor has tried to make us know is that the instrument he is going to raise is not a loan. He has what it takes to create the money from the market without involving the assets of the state.

“The second thing is that the instrument does not require deduction of allocations to the state. If the money is not going to be deducted from the federation account, that means we have no issue because what would have been an issue is how we would get the money refunded.

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“The governor is a financial expert and a banker, he knows how to create the money from the banks. He knows how they trade, he knows how they get promissory notes, and he knows how they get financial instruments sorted out.

“Having looked at what he wants to do with the money, I believe that it is something that is good for Akwa Ibom people. All we can do is to make sure that the various MDAs are properly oversighted to ensure that projects are completed, and on schedule to make sure that Akwa Ibom benefits from the money raised to the state.

“The airport terminal building, the taxi way construction, drainage system in the airport, payment for other projects that were done before the governor came in and the major road construction spanning the 31 LGAs of the state, he needs the money for these projects to be done”.

The motion granting the request was unanimously carried by all the lawmakers.

Accordingly, those who spoke were Aniefiok Dennis Akpan (Etinan), David Lawrence (Eket), Aniekan Uko (Ibesikpo Asutan), Uduak Odudoh (Ikot Abasi/Eastern Obolo), Charity Ido (Ukanfun), and Godwin Ekpo (Ibiono Ibom) all said they supported the governor’s request.

Meanwhile, the House has passed a supplementary budget of 45 billion for the year 2022.

The budget was passed after Uduak Odudoh, chairman of finance and appropriation committee, presented a report during the plenary session.

While presenting his report, Odudoh said his committee engaged with the state’s finance commissioner and other stakeholders on the governor’s request for passage of the budget which came three months into the 2022 fiscal year.

While N41 billion was approved for recurrent expenditure, N4 billion was earmarked for capital expenditure.

Odudor said the budget would be funded through statutory revenue, derivation revenue as well as direct credit substitutes and receivable discounting facility.

The House had received a bill for the supplementary budget from Governor Emmanuel last week, to make an increase in the 2022 budget size of the state passed in December, 2021, from N586 billion to N631 billion, an increase of N45 billion from when it was approved.