The Lagos State government seven-year bond, with Chapel Hill Denim Limited as lead book runner/ issuing house, is the largest sub-national bond ever issued in Nigeria and represents the first tranche, under its N167.5 billion debt issuance programme between now and 2019.
It is also the fourth time the state is raising funds via bond issuance to drive its infrastructural development.
According to Lagos State officials, the total sum is to be invested in infrastructural development, which remains the thrust of the Governor Babatunde Fashola-led administration.
To benefit from the fund, are such ongoing projects as the expansion and reconstruction of the Lagos-Badagry Expressway, Blue line rail corridor, ferry terminals in parts of the state to boost water transportation, construction and completion of health institutions, such as ‘Ayinke House’ within the Lagos State University Teaching Hospital (LASUTH), and Maternal Healthcare Centres, among others.
A member of the state executive council, recently told BusinessDay that the earlier estimated N120 billion for the Lagos-Badagry Expressway is now a far cry from what will be actually needed to complete the project, which is designed to accommodate rail, and a bus rapid transit (BRT) scheme in the middle.
At the completion board meeting for the deal at Lagos House, Ikeja, attracting all participating financial houses and stock broking firms, Fashola assured that the money would be tied to specific projects that add value to the state’s economy.
“This is a serious undertaking that imposes serious responsibilities on us,” Fashola said.
He added that when the administration came out the first time to float a bond, it did so stating clearly that its focus was on infrastructural development, which it has kept faith with.
Fashola said Nigeria and Lagos had lived with 40 years of infrastructural decay, an unfortunate development, which according to him, must be tackled in order to give future generations a better life.
Further justifying the bond transactions which will run beyond his administration, Governor Fashola said “if my tenure is making progress towards the end, my responsibilities to the people have not stopped. So I have to borrow to do what I should do,” adding that “what I can do with N10 today, my successor cannot do it with that same N10 tomorrow.”
He observed that government has unending responsibilities which money from taxes alone could not address, hence the need to borrow in a sustainable manner, stressing that Lagos, as a state has continually successfully offset debts from previous bonds.
No comments:
Post a Comment