The Ogun State government reassured residents on Monday regarding concerns about the state’s debt profile, which exceeds N200 billion, asserting that there is no need for alarm. The Prince Dapo Abiodun-led administration affirmed its commitment to positioning Ogun as a leading economy in Nigeria by maximizing human and capital resources.
The state Commissioner for Finance, Mr. Dapo Okubadejo, addressed these concerns during a media parley on the breakdown of the approved 2024 appropriation law at the Olusegun Osoba International Press Center in Oke Mosan, Abeokuta.
Flanked by the Commissioner for Budget and Planning, Olaolu Olabimtan, and the Special Adviser to the Governor on Media, Kayode Akinmade, Okubadejo explained that the administration is mindful of directing state debts towards funding capital expenditures aimed at expanding the revenue capacity and economic base of the state.
Okubadejo emphasized the careful selection of the type of debt incurred and the strategic use of such debts for capital infrastructure projects that have the potential to increase the state’s revenue base. He clarified that many of the external loans are long-term loans used as working capital, with a significant portion dedicated to funding capital expenditures.
He stated, “There is no cause for alarm. In fact, you should all go and sleep because not only are we careful with the type of debt we take, we are also judiciously utilising the debts for capital infrastructure that will increase our revenue and improve the economic base, and we have the capacity to pay back.”
The commissioner highlighted the state’s adherence to sustainability ratios set by the Federal Debts Management Office (DMO) and the pursuit of long-term loans where possible. He mentioned that the state is opening its economy to private sector investors and is exploring concessioning as a way to attract private investments.
Okubadejo previously disclosed that the 2023 budget of N703 billion would be largely funded through the state’s Internally Generated Revenue (IGR) of N240 billion, with expected Federal Allocations at N182 billion. He ruled out the possibility of overtaxation, emphasizing a financial reengineering policy to meet revenue targets.
The commissioner highlighted the state’s efforts to create a conducive environment for private sector investment, including the establishment of economic development clusters and measures to reduce the cost of doing business. He underscored the administration’s economic objectives, focusing on real sector growth, job creation, food security, poverty eradication, and increased investment.
