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The Cross River State House of Assembly has rejected a N15 billion loan request by the state government, a development that is causing friction between the executive and legislature.
A letter dated January 14, 2020 and signed by Secretary to the State Government (SSG), Tina Agbor and sent to the Speaker of the House, stated that the state government had in recent times been contending with cash flow shortfall, which had challenged government’s efforts in meeting some of its statutory financial obligations.
“In line with the state government’s desire to industrialise the state, it approached the United Bank for Africa (UBA) for an N15b facility for development of projects in the state.
“In consideration of the above, the state executive council at its first meeting in January 2020, resolved to get an N15b loan. This facility will be used to fund development and allied projects. The facility has 120 months repayment plan at 15 per cent interest rate per annum.
“Consequently, I am pleased to convey the governor’s request to the Speaker and members of the House to consider and approve the loan. We count on your usual expeditious consideration,” the letter reads.
But the State House of House of Assembly on February 4, 2020, rejected Governor Benedict Ayade’s loan request, just as it stood down a request to approve 30 additional special advisers (SAs) for the governor, saying members were not carried along on appointments.
The House presided over by the Speaker, Eteng William Jonas, disapproved the borrowing, saying the lawmakers “can’t continue approve loans that would make the state insolvent.”
The House also complained over alleged hand picking of councilors and chairmanship candidates ahead of the March 28, 2020 council polls.
Meanwhile, some residents of the state have condemned the loan request, saying Cross River was already owing over N240b and that its allocation from the federation account was low.
They criticised Governor Ayade for appointing many aides, who they argued, do not contribute meaningfully to the development of the state and its economy.
A former governorship candidate of the Peoples Progressive Alliance (PPA), Goddie Akpama, urged the state House of Assembly not to approve the N15b loan request.
He said, “I received news of Governor Ayade’s request for N15b loan with consternation. This is unnecessary, especially given the state’s precarious financial situation. So far we have not had anything to show for all the monies that have come into the state. What were the Paris Club refunds and bailout funds used for?
“We are crying over the loans accumulated by Donald Duke and Liyel Imoke and Ayade wants to add more. Where are we going to get the money to pay back the loans?
Another indigene of the state, Tete Ebri said, “Another loan again for 120 months (10 years) was unacceptable, while Etim Asuquo, a businessman said he saw nothing wrong in taking loans.
“He who wears the shoe he knows where it pinches. My take is that the loan should be judiciously utilised for the development and benefit of the state,” he added.