Business
Economic crisis: States beg FG for bailout again
The current economic downturn in the country may have started bitting harder than expected, as there are indications that state governments have asked the Federal Goverment for bailout, just six months after 19 of the 27 states were financial rescued. This is said to have been occasioned by another round of cash crunch in the states, Thisday reports.
According to the report, most of the states that got from the N400 billion intervention fund, offered through the Central Bank of Nigeria (CBN), by the FG have approached the presidency and the CBN for another bailout.
The Lagos State government is said to have however stayed away from the bailout request, largely due to the volume of internally generated revenue that comes into the coffers of the state, said to be around N23 billion monthly.
It would be recalled that President Buhari also ordered the sharing of about $2.1 billion Liquefied Natural Gas (LNG) proceeds that accrued to the Federation Account with the states.
Revenue accruing to states governments has reduced drastically following the fall in oil prices in the international market, while many of the states that are deep into debts with commercial banks, get next to nothing after deductions are made.
The states that got bailout included Ekiti, Nassarawa, Kwara, Kebbi, Zamfara, Osun, Niger, Bauchi, Gombe, Abia, Adamawa, Ondo. Others that enjoyed the facility were Imo, Ebonyi, Ogun, Plateau, , Sokoto, Edo and Oyo
In many of the states, workers have downed tools over unpaid salaries while several other states are fighting hard to fend off brewing labour crisis as the states are unable to meet their obligations to their workforce.
Speaking on the development, analysts at Dunn Loren Merrifield, an investment banking outfit, advised states to stop depending on allocations from the federation and look inward by having in place a strong internally generated revenue (IGR) mechanism.
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