All the capital projects executed with borrowings by the Lagos government have so far helped to check rural-urban migration in the state, its Governor, Akinwunmi Ambode, has said.
According to the governor, who disclosed this during the just-concluded 9th annual Bankers’ Committee retreat in Lagos, the current massive infrastructural renewal in every part of the state is a strategy to create employment at the bottom of the pyramid and keep the youth from migrating to the urban centres.
He added that by so doing, he has been able to accelerate growth and helped the economy reflate itself.
His words: “Everything that I am doing, even when I take a loan from a bank, even when I do bond, I only try to defend the economy. Each construction site that you see in Lagos, I am trying to create employment at the lower level so that the artisans, the bricklayers, can go home with N5000.I don’t need to do something in Badagry , but I need to employ people there so that they stay in Badagry and they do not need to come to central Lagos.”
The governor was disappointed by the brickwall met while processing bank facilities to execute the projects, saying that such obstacles were capable of stifling growth and commerce.
Hear him: “I, as a state government, I want to take a commercial loan from a bank.They tell me, I should go and get a letter from DMO; I should go and get approval from the Federal Ministry of Finance; I should go the CBN.Who does that? And you want to accelerate growth? When you take the extra money outside the IGR, you are only trying to help the economy to reflate itself. And that is why you are able to excite yourself with the growth that you have seen in the third quarter that you say was 1.5 per cent.
That is not the number that we want. So sometimes, government seems to shoot itself in the leg. Why should Lagos State go and be meeting DMO: I want to take a commercial loan when 80 per cent of my IGR can pay the loan itself back. So you see that there is some sense of homogenuity in the policies that we make, but sometimes they are not really flexible. And you end up, you come back and say you want to create jobs. But the things that create jobs are the things that we are actually working against. And you create unnecessay competition in the system.”
Recall that the state recently paid N141.59 billion to bond holders in its various fixed rate bond programmes it undertook to support its developmental agenda. The bonds included the Lagos State N80 billion fixed rate programme two, series one floated in 2012 with a maturity date of 2013; N87.5 billion fixed rate programme two, series two floated in 2013 with a maturity date of 2020 and N47 billion fixed rate programme three, series two floated in 2016 with a maturity date of 2023.
Addressing participants at the AGM, the Commissioner for Finance, Akinyemi Ashade, noted that the various bonds had been used to upscale infrastructural development in the state in the areas of roads and bridges construction, water, transportation, health and waterfront infrastructural development.
According to him, $50 billion was needed to address infrastructural deficits in the state, which he said, was part of the reasons the government floated bonds to bridge the gap, adding that over time, two bridges had been constructed with the proceeds from the bonds while major infrastructure were upgraded across the metropolis.