The Chairman, Senate committee on Foreign and Domestic Debts, Senator Shehu Sani, has described the plan by Northern governors to obtain loans from a Saudi Arabia-based Islamic Development Bank, as unlawful.
In a statement issued in Abuja yesterday, Sani said that the action was in direct contravention of the Act, which vested the responsibility of external borrowing in the Federal Government.
He said that the Debt Management Office Act 2003, section 21 and external borrowing guidelines 2008-2012, paragraph 2.1 clearly state that any government or its agencies can only obtain external loan through the Federal Government and such loans must be supported by the central government guarantee.
The lawmaker pointed out that the Act explicitly stated that no state, local government or federal agency shall, on its own, borrow externally.
Sani, therefore, argued that the Northern governors could not just go to Saudi and take loan without recourse to the provisions of the law, stressing that they must get approval of the Federal Government before they could obtain external loan.
His words: “The recent solo moves by governors of the northern states to obtain loan from the Saudi-based Islamic Development Bank is in direct conflict with the Laws of the Federal Republic of Nigeria.
“The action of the governors runs contrary to the relevant provisions of the act that clearly and unambiguously rest the exclusive right to borrow externally on the Federal Government.”
