A Civil Society Organisation (CSO) known as Policy Alert, which focuses on fiscal and ecological justice in the Niger Delta, has strongly criticized and condemned the Akwa Ibom State government for paying a staggering N104.66 billion as interest on loans obtained from commercial banks over the past eight years.
The CSO revealed that between 2015 and 2022, the Akwa Ibom State government disbursed a total of N104.66 billion to commercial banks, a figure that falls short by only N600 million from the highest annual revenue generated by Abia State during the same eight-year period.
In a statement signed by the Programme Officer for Fiscal and Governance Reforms, Faith Paulinus, after the organization’s 8th annual Open Budget Forum (OBF) held in Uyo, the CSO analyzed the financial statements of Akwa Ibom State from 2015 to 2022 and noted the following interest payments: N4.46 billion in 2015, N12.84 billion in 2016, N14.3 billion in 2017, N12.4 billion in 2018, N12.2 billion in 2019, N10 billion in 2020, N15.51 billion in 2021, and N22.95 billion in 2022.
The CSO expressed concern that the interest rates for the loans obtained by the Akwa Ibom State government have been shrouded in secrecy over the past eight years. The alarming amounts paid as interest raise serious questions about the nature of these deals.
Moreover, the CSO pointed out that it is worrying for Akwa Ibom State to pay higher interest on commercial bank loans compared to Delta and Rivers State, despite the fact that the debt burdens of the latter two states are higher. This discrepancy further underscores the urgent need for the Akwa Ibom State government to provide transparency in its loan arrangements.
In a statement, the CSO highlighted, “What is even more troubling is the source of these loans over the reviewed period. Out of the 57 loans obtained, 28 of them, representing half of the loans, were sourced from Zenith Bank. Additionally, 13 out of the 18 outstanding loans belong to Zenith Bank. It is significant to note that Mr. Udom Emmanuel, who served as Governor during this period, had previously held the position of Executive Director at Zenith Bank. This raises serious concerns about the nature of the loans and the subsequent interest payments.”
The CSO stressed the importance of conducting a thorough investigation into the interest payments made by the Akwa Ibom State government and called on the state government and accountability institutions to recover the funds.
