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10 oil-producing states borrow N1.31 trillion despite receiving 13% derivation fund

December 2nd 2022, 12:06:40 pm

Fresh details have emerged showing that 10 oil-producing states in Nigeria borrowed the total sum of N1.31 trillion despite receiving N6.4 trillion in federal allocation and the 13 percent derivation fund.

10 oil-producing states borrow N1.31 trillion despite receiving 13% derivation fund

The 10 states, Rivers, Akwa Ibom, Delta, Edo, Abia, Ondo, Imo, Cross River, Bayelsa and Lagos increased their combined total debts from N2.04 trillion in December 2015 to N3.35tn as of June 2022.

This was revealed by the sub-national debt report of the Debt Management Office, DMO which also confirmed that within a period of seven years, a total of N1.31 trillion was borrowed by the states.

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According to The PUNCH, the oil-producing states received payment of N6.4 trillion being federal allocation accrued to the states and also, 13 percent derivation fund accrued to the Niger Delta/oil-producing states.

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According to data from the National Bureau of Statistics sighted by the PUNCH, between 2016 and 2020, the oil-producing states got N4.46tn from the Federation Account Allocation Committee.

When this amount is added to the N1.98 trillion paid as 13 percent derivative funds to the oil-producing state, the amount moves to N6.4 trillion.

Recall they have been an uproar concerning the recent announcement made by the Rivers state governor, Nyesom Wike concerning the 13 percent derivations funds reportedly paid to the oil-producing states by the FG.

Some of the affected governors who are yet to make public, the amount they have received so far have been queried by concerned citizens on the matter.

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According to the Minister of Finance, Budget, and National budget, Zainab Ahmed, a total of N1.98 trillion was disbursed as a share of the 13 per cent derivation fund to oil-producing states. She added that this amount was paid within a seven-year period.

Ahmed further added that the government had supported states with N5.03 trillion and an additional $3.4 billion since 2015.

Solomon Ekanem
Solomon is a digital content editor and a Business/Tech contributor for Pulse.

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