Weak naira responsible for high debt service rate… – Osun govt

Shina Abubakar, Osogbo

The Osun State Government has disclosed that its high debt service rate was due to weak naira rather than new borrowing.

The National Bureau of Statistics, NBS, in a report, disclosed Osun is among the top ten states with high debt service rates.

Reacting to the report through a statement, the Commissioner for Information and Public Enlightenment, Kolapo Alimi noted that the situation was not due to new borrowing by the Ademola Adeleke-led administration.

It reads partly, “The public would kindly recall that repayment on foreign loans is usually done based on the prevailing exchange rate of the local currency (Naira) to the US dollar.

“It is also important to put on record that Osun state was plunged into high local and foreign indebtedness in the 12 years of APC government in the state.

“As the repayment is done in line with the prevailing rate, there is an increase in the naira value of monthly loan repayment on the foreign loans portfolio of all the States of the Federation.

“The inevitable increase, therefore, is not only peculiar to Osun, rather, it applies to all the States and the Federal government.

“The public is assured that the state financial management is responsible and sustainable without any new indebtedness”.

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