Enugu State Executive Council has approved the state executive memo for the restructuring of the state’s commercial bank loan to federal government bonds to alleviate the burden of debt weighing down the state
The new State Attorney General and Commissioner for Justice, Chief Miletus Eze, in a press briefing to the Government House Press at the end of the maiden executive council meeting presided over by Governor Ifeanyi Ugwuanyi at the Government House, Enugu, said the issue was handled as a pressing state matter, in other to beat a deadline that would expire yesterday.
The commissioner did the press briefing alongside with Dr. Sam Ugwu and Mrs Eucharia Offor who are also commissioners, noted that depth burden weighing on the state is heavy that without the restructuring the state would be in difficulty.
He added that the deadline for the restructuring exercise was on the 16th of July, 2015.
In his own briefing, Dr. Sam Ugwu noted that the restructuring exercise was sequel to the outcome of National Economic Council meeting in which the exercise was identified as a bail out to states that are on depth difficulty. He disclosed that Enugu State is owing N6.4 billion naira with accruing interest of N1.5 billion naira which necessitated the deduction of four hundred million naira (N400,000,000) in the state’s monthly allocation.
In her briefing, Mrs. Offor enumerated the advantages of Federal bond over commercial bank loan.
The Federal Government bond helps in monthly depth servicing and that the interest on federal government bond is lower than commercial bank loan.
Fielding questions from the pressmen, Dr. Sam Ugwu noted that restructuring would improve on the depth management, adding also that a state has the power to still borrow for urgent projects, the restructuring programme notwithstanding.
