Lend to us at 1%, governors beg World Bank

The Nigeria Governors Forum (NGF) has asked the World Bank to provide loans to state governments at 1%, saying it would be cheaper than the 25% commercial rate.

Kayode Fayemi, NGF chairman and Ekiti state governor, made this known on Wednesday while briefing journalists at the end of a one-day interactive session on the bank’s project across states in the country.

Fayemi said the purpose of the meeting was to look at ways of engaging with the bank, review things that states are doing right and how to accelerate the deployment of resources that are available within the portfolio for states.

“There is a question of course of also not having enough resources and the need to expand the lending portfolio from what it is now both to the federal government and the sub-national entity,” he said.

“It is absolutely important that that vehicle is not closed because if we can borrow from the World Bank at 1% interest it is always going to be better for us than for us to borrow at 25% commercial lending rate, that is a no brainer, we will all agree with that.

“We had an extensive discussion on how to improve on the existing relationship and how to build on those projects that have transitioned from one governor to the other because periods of transition can be challenging.”

Commenting on the delibrations, Rachid Benmessaoud, World Bank country director, said tackling poverty in Nigeria would be critical in fighting poverty globally.

“Our priorities which we have engaged with the governors will be around investing in human capital, investing in people to have access to basic education, health services, social protection.

“But we do recognize that development challenges also require investing in infrastructure and filling the large infrastructure gaps.

“So therefore what we have done today in this workshop hosted by the NGF, is to go over the portfolio at the state level and to how it can accelerate the implementation of the programmes. The portfolio ranges from health, education, soil erosion, water and it has a lot of investments that are also performance-based, where the state is rewarded on the basis of performance on certain indicator.

“As the chairman has said, better education, reducing the number of out of school children, the states fiscal performance, providing basic primary healthcare, a range of activities already implemented. We wanted to make sure that the new governors, as well as the returning governors, are well aware of the programmes being implemented in their respective states and what it will take for them to accelerate the pace of implementation.

“We are excited with this new partnership in the sense that both the returning and new governors have the way forward so that at the end of the day it is not about how much money is being dispersed but how much lives we are willing to collectively transform.”