Niger Assembly Clarifies Details of Loan Request Concerning Governor Bago’s $14.4 Million Proposal
The Niger State House of Assembly clarified its position on the $14.4 million (approximately 20.4 billion Naira) loan request submitted by Governor Umaru Mohammed Bago. The Assembly emphasized that the governor’s communication was solely to seek approval for the state to guarantee a loan facility involving the Niger Food Security Systems and Logistics Company.
During a session in Minna on Wednesday, Speaker RT Hon Abdulmalik Sarkindaji explained that, contrary to misconceptions implying approval of a new loan, the request was specifically for the government to guarantee a loan obtained by Niger Food Security Systems and Logistics Company through UBA.
The purpose of this guarantee is to enable financing from Saudi Exim Bank to support the expansion of operations, including the development of a 3,000-hectare irrigated farm estate in the state.
The Speaker highlighted the importance of this clarification, noting that recent reports misrepresented the nature of the request. He explained that during Tuesday’s plenary, the Assembly received a letter from Governor Bago requesting legislative approval for a bank guarantee with UBA to finance the company.
He stated, “We only received a request from the governor seeking approval to enable the government to act as a guarantor between Saudi Exim Bank and Niger Food Security Systems and Logistics Limited.” He reiterated that this was not a request for a new loan but a request for the Assembly’s approval to back a loan facility.
The request was for the Assembly to approve the guarantee, which has been referred to the appropriate committee for further review.
The Speaker emphasized that Niger Food Security Systems and Logistics is a separate corporate entity, even though the state is its largest shareholder. The company functions as a limited liability company with its own management.
He further clarified that the responsibility for repaying the loan lies solely with Niger Food Security Systems and Logistics. The state’s role is limited to providing a guarantee, due to its significant shareholding in the company.
The Speaker underscored that the guarantee arrangements comply with relevant legal provisions and that the government’s role is to serve as a guarantor for the facility. He added that the government remains open to applying for loans for developmental projects, which the Assembly would duly consider.
Finally, he noted that the Assembly keeps records of all financial facilities extended to the government and urged anyone seeking the state’s debt profile to consult the Debt Management Office.
