Economists have questioned the wisdom of the Oyo State House of Assembly approval of a proposed N200bn infrastructure bond, warning that the move comes at a politically sensitive time and raises concerns about accountability, election spending, and the state’s ability to raise the funds from the capital market successfully.
The Assembly recently approved Governor Seyi Makinde’s request to raise the bond from the capital market to refinance short-term loans used to fund infrastructure projects across the state.
According to the governor, the refinancing plan would restructure the state’s debt profile, lower debt servicing costs and create additional fiscal space for developmental programmes.
The state said the existing loans attract interest rates of between 22 and 26 per cent annually, while the proposed bond is expected to carry a fixed rate of between 17 and 19 per cent.
However, economists who spoke with The PUNCH expressed scepticism over the timing of
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