Lagos gets $200m in second instalment from WB’s $600m loan

Gov. Akinwumi Ambode has got the federal government nod to source a $200 million loan through the International Development Association, a unit of the World Bank, who is said to be in sync with the development efforts of Lagos government.

Information minister Lai Mohammed made this known Wednesday after the Federal Executive Council meeting. The loan approval was granted after a memo from finance minister Kemi Adeosun.

The loan, according Mohammed, will allow the state government to complete some of its very ambitious projects, including the 61 kilometer, 10 lane Lagos to Badagry expressway, which also includes the 27 kilometre light rail.

It will also enable the state government to completely rehabilitate the inner roads in Apapa in addition to some other major works it is carrying out.

Ex-Gov. Raji Fashola, now works, power, housing minister, said the loan is not new. “It is a segment of a programme of developmental initiatives. It was approved in 2010, a total sum of $600 million for Lagos State, to be disbursed in tranches of $200 million each year starting from 2011, 2012 and 2013,” said Fashola.

He explained how partisan politics in the last administration had delayed access to the loan after the first tranche of $200 million was released.

The delay, according to him, has cost Nigeria the opportunity of 40 years.

“The initial agreement we had with the World Bank was a 40-year loan, on a 10-year moratorium and 0.5% interest. But because of the delays that subsequently characterized the partisan interference that took place, our profile as a nation also changed.

“It is now a loan of 25 years, the moratorium has reduced to five years instead of 10 years, and the interest rate has gone up to 1.25%,” he said.

The loan will be paid back by monthly deductions from the Federation Account Allocation coming to Lagos.

The former Lagos governor, however, said it was heart-warming to still obtain the loan at the reviewed indices since it helps to finance infrastructure.

“Infrastructure defines how big a nation can go. It is the defining line between rich nations and poor nations. That is the best way to distribute wealth in a society,” he said.

Advertisement