Toba Owojaiye Reporting
Former Senator Shehu Sani has once again raised the alarm regarding the contentious $350 million World Bank loan that Kaduna State accepted, shedding light on its ominous repercussions. Sani, who vehemently opposed the loan when it was initially proposed, endured years of criticism and even threats to his life.
Today, his concerns have resurfaced as Kaduna State grapples with an impending financial catastrophe.
What makes this situation particularly dire is the drastic shift in exchange rates. At the time of borrowing, one US dollar equaled 400 Naira, but that figure has surged to a staggering 1000 Naira and shows no signs of abating.
The loan was ostensibly intended to finance various development projects, but doubts are mounting regarding their capacity to generate the necessary revenue for repayment. The consequences of this fiscal gamble are now manifesting, and they are painful.
Kaduna State currently finds itself as the second most indebted state in Nigeria, trailing only behind Lagos. This is where the contrast becomes stark. While Lagos enjoys a robust industrial, banking, commercial, and maritime sector, capable of generating significant internally generated revenue (IGR) to service its debts, Kaduna’s industries languish in disarray. The weight of the loan now presses heavily on the state’s fragile economy.
The fallout from this situation is severe. Kaduna State’s external debt has ballooned to nearly $600 million, exacerbated by the plunging value of the Naira. The citizens of the state bear the brunt of this financial recklessness, and the scenario threatens to strangle, stagnate, and trap Kaduna in an inescapable debt quagmire.
Senator Shehu Sani’s revelation serves as a stark reminder of the risks associated with imprudent borrowing and underscores the urgent need for sound fiscal management. As the people of Kaduna State grapple with the consequences, there is an emphatic call for transparency and accountability in handling state finances to forestall a full-blown economic crisis.
Additionally, it’s worth noting that the political rivalry between Shehu Sani and the former governor, El Rufai, adds another layer of complexity to this ongoing financial predicament.