Osun State Government Denies Plans to Obtain New Loan Amid Rising Debt Payments
The Osun State Government has refuted reports that it is planning to obtain a new loan, emphasizing that the recent increase in monthly loan repayments on the state’s foreign debt is not due to any borrowing by the current administration.
This clarification was made by the state’s Commissioner for Information and Public Enlightenment, Kolapo Alimi, in a statement on Tuesday in Osogbo. The statement was in response to a report by the National Bureau of Statistics (NBS), which listed Osun State as the 10th among states with high debt service payments.
According to the NBS report, “Osun State, located in Nigeria’s southwest, is culturally known for the Osun-Osogbo Festival. In 2024, Osun recorded N3.4 billion in external debt service costs, up from N1.57 billion in 2023. This represents an increase of N1.83 billion or about 116 percent.”
Commissioner Alimi attributed the rise in foreign loan repayments to the current exchange rate of the Naira against the US Dollar, not to new debt incurred by the administration. He stated, “The public would kindly recall that repayment on foreign loans is usually done based on the prevailing exchange rate of the local currency (Naira) to the US Dollar.”
He further explained that the state’s significant debt burden is a result of the previous 12 years of governance under the All Progressives Congress (APC).
“As the repayment is done in line with the prevailing rate, there is an increase in the naira value of monthly loan repayment on the foreign loans portfolio of all the states of the federation,” Alimi added. “The inevitable increase, therefore, is not only peculiar to Osun, rather, it applies to all the states and the Federal Government.”
Alimi reassured the public that the state’s financial management remains responsible and sustainable, and that the government has not taken on any new debt.
