The Lagos State government is set to borrow N97 billion despite growing debt profile which has not reach N39.69 billion.

However, the state government has said there was no need to panic over the state’s debt, noting that the government has the situation under control.

The Commissioner for Finance, Rabiu Olowo, explained that the lion share of the debt profile was mostly was from internal debt, adding that the state government has the capacity to service its debt profile comfortably.

He said Lagos State Government’s sustainability figures were in tandem with international and local standard, stating that the state finished 2019 at 29% which is below 30% benchmark.

“Our professional position on debt issuance by Lagos State Government, there are two questions when debt is being considered, they are utilization and sustainability figures.

“For debt utilization alone, with fiscal Responsibility Act, 100% of our debts are targeted towards capital projects.

“If you look at sustainability figures we are very much in line with international and local benchmarks.”

He added that “Currently, we finished 2019 at 29%, which is below 30% benchmark. Going forward into medium-term by 2021, 2022, debt figure will come down to 25 per cent meaning that we will be able to manage our debts into the future with increasing revenue in the coming years.

“For Lagos debt charges, our External debt charges stand at N4.9 billion, internal debt charges is N29.7 billion, while charges on the bond are N5 billion. In totality, it amounts to N39.692 billion.

“Also, the deficit financing of the budget is in a total of N97 billion. The breakdown is External loan, N34 billion, while an internal loan is N63 billion.”

He added that despite the debt profile of the State, Lagos remains Nigeria’s economic hub and one of the leading economies in Africa.

The State’s external debt is N4.9 billion, internal debt is pegged at N29.7 billion, while charges on the bond are N5 billion. This makes the total debt profile of the Lagos State Government N39.692 billion.

Among the States and FCT in Nigeria, Lagos has the highest foreign debt profile in Nigeria, accounting for 5.64% while Edo accounts for 1.095%, Kaduna follows with 0.90% and Cross River reportedly accounts for 0.75%.