FEC Approves $200m Loan For Lagos State

   

The Federal Executive Council Meeting yesterday approved the sum of $200m loan from international Development Association for Lagos state.
The Minister of Information and Culture, Alhaji Lai Mohammed and the Minister of Power, Works and Housing, Mr. Babatunde Fashola (SAN), briefed State House correspondents at the end of the meeting presided over by President Muhammadu Buhari.

The loan would enable the Lagos State Government to complete some if its ambitious projects, such as the 61km 10-lane expressway from Lagos to Badagry that would also include 27-kilometre light roads.Lai Mohammed explained 
He said the facility would also enable the state government to rehabilitate the inner roads in Apapa in addition to some other major ongoing works.
Fashola said that the loan was not a new one but a segment of a programme of developmental initiatives which was approved in 2010 with a total sum of $600m for Lagos State,which was meant to be disbursed in tranches of $200m  each year beginning from 2011 to 2013,but suffered delays as a result of partisan political differences in the last dispensation.

He said, “After the first tranche was disbursed, there was a freeze on the second tranche. The initial agreements we had with the World Bank was a 40-year loan, a 10-year moratorium and 0.5 per cent interest.

“…so by the time this one was approved now because of the delays, we had lost the opportunity of 40 years as it is now a loan of 25 years, the moratorium has reduced to five years instead of 10 year

“The interest rate had gone up to 2.5 per cent, but what is still heart-warming about it is that it helps to finance infrastructure

“When we look at road construction and the value chain that people benefit from it, those who sell iron rods, artisans, craftsmen, that is really global economies are being reflated and infrastructure defines how big a nation can grow, it is the defining line between poor and rich nations.

“It is heartwarming that this administration has taken it on and again fast-track it so that the Lagos State government can continue its developmental programmes of infrastructure renewal, taking people out of poverty reducing inequality because that’s the way to really distribute wealth in a society.”