States to draw from bailout soon – Presidency

The Presidency on Monday said the implementation of a three-pronged financial intervention of President Muhammadu Buhari to assuage workers plight and support the states is now in progress.
Senior Special Assistant to Vice President Yemi Osinbajo, Mr. Laolu Akande, said this in a statement.



Akande said state governments would start benefiting from the special intervention fund of between N250bn and N300bn in a matter of weeks.

He explained that planning meetings were currently being held between members of the Federation Account Allocation Committee and the Central Bank of Nigeria on the one hand, and also between CBN and commercial banks on the other hand.

He said the meetings had been centered on the details of the special intervention fund and the debt relief programme of the President for the states.

Akande said, “Such meetings are reviewing loan profiles of the states, issues around restructuring of existing loans including time span, and reconciling the figures.

“Already, it has been agreed that existing state loans be restructured for 20 years, and regarding the bond option, the rates to be applied would be market-based but with a cap to make it affordable.
“Within weeks from now, the states are expected to start benefiting from this two other parts of the presidential intervention.”

Akande said by extending the commercial loans of the states, the third part of the presidential intervention would therefore make available more funds to the state governments, which otherwise would have been removed at source by the banks.

He further explained that to be able to offer the option to the states, Buhari brought the financial muscle of the Federal Government to bear on behalf of the states guaranteeing the elongation of the loans.

The Presidency spokesman added, “Besides, the availability of the $2.1bn from LNG, which has now been shared to the states, was made possible because President Buhari set a new fiscal standard and tone that all monies generated should go to the federation accounts.

“Before that constitutional standard was upheld by the President, LNG dividends were going to other NNPC designated accounts.

“None of the three parts of this intervention would have been possible without the creativity and approval of President Buhari. It should be noted that the backlog of the salaries in some of the states went back several months before the President took office.

“To date, the states have now drawn from the LNG taxes and dividends totaling $2.1bn besides a second sharing from the federation account, that is, the regular monthly allocations, a sum of over N518bn last week.”