Conversion of Loans to FG Bonds: Another Evidence of the Failure of Governance in #AkwaIbom State

On Tuesday 18th August, 2015 a letter of request with reference number GHU/AKS/S/104/VOL. V/650 submitted by Mr. Udom Emmanuel was read on the floor of the  Akwa Ibom State House of Assembly during the plenary session of the House seeking legislative approval to convert debts owed and obtained from commercial banks in the country by the immediate past administration of his political godfather and benefactor, Sen. Godswill Akpabio, to Federal Government Bond.

The Coalition of Human Rights Defenders (COHRD) views this development as another incontrovertible evidence of the gross failure of governance in Akwa Ibom State and the shameful, scandalous and criminal waste of public funds by the erstwhile administration of Sen. Godswill Obot Akpabio. For us, this is a tacit admission by Mr. Udom Emmanuel that indeed the state is in a state of financial crisis and comatose.

The proposal which seeks to convert and restructure the bad loans to bond with the assistance of the Debt Management Office (DMO) will have a tenor of between 15 – 20 years. The implication is that for the period, the state will have the responsibility of servicing the bond which will be a huge burden on the next generation.

Mr. Emmanuel in the letter explained that the arrangement centered on restructuring of State Commercial Bank Loans into Federal Government Bond as a measure to restore fiscal stability to the state. He further hinted that the National Economic Council meeting held on June this year with the title “Options for liquidating unpaid salaries by State government”, makes it possible for the state to take advantage of the initiative in partnership with the Debt Management Office (DMO) and the Federal Ministry of Finance.

Regrettably, Mr. Udom Emmanuel did not state in his letter the exact amount of money owed commercial banks in the country by the state government. This we believe is willful and deliberate. It is a continuation of the culture of running government like a secret cult/criminal enterprise without any modicum of regard to the dictates of transparency, accountability and good governance.

However, it is common knowledge that Mr. Akpabio had obtained huge loans from banks to service his insatiable escapades and primitive ostentation and profligate lifestyle at the peril of the state. It is on record that recently, Diamond Bank Plc, one of the banks that the state is indebted to, published a bad loan of N5.8 billion obtained by Mr. Akpabio.

COHRD urges the President Muhammadu Buhari administration to consider requests by state governments to convert their loans to Federal Government Bonds on individual merit due regards being paid to whether such loans were properly utilised by the affected states in consonance with the accountability mantra of the government. It is on record that Akwa Ibom State ranks above other states in the federation in federal allocations for several years now.

Unfortunately, COHRD has noted with concern the apparent failure by the Economic and Financial Crimes Commission (EFCC) to duly investigate plethora of factual petitions detailing serial embezzlement of state funds by the erstwhile administration of Godswill Akpabio. COHRD is of the strong view that the Ibrahim Lamorde-led EFCC may have been terribly compromised by the apostle of “what money cannot do, more money can do” – Mr. Akpabio.

We appeal to President Buhari to urgently come to the aid of Akwa Ibom State by including the state in its asset recovery and anti – corruption drive for the sake of justice and in the interest of future generations of the state.


Inibehe Effiong, ?Convener, Coalition of Human Rights Defenders (COHRD).

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