Obaseki Maintains Claim As FG Denies Printing ₦60 billion Currency to Augment FAAC

Godwin Obaseki photo
Godwin Obaseki, Edo State governor

Opposition Knocks Governor, Fayose Supports Him.

The claim by Edo State governor, Godwin Obaseki that the federal government, through the Central Bank of Nigeria, printed between ₦50 and ₦60 billion to shore up the federal allocation for March to underscore the country’s “huge financial problem”, has continued to elicit reactions with some knocking the governor for what they perceived a bogus claim while some others call for caution in dismissing the claim.

Both the Central Bank of Nigeria, CBN and the ministry of finance, budget and economic planning, have pooh-poohed Governor Obaseki’s claim while the opposition party in the state, the All Progressives Congress, APC has also dismissed the claim as “laughable, unwarranted and unfounded”. Former Ekiti State governor, Ayodele Fayose however insisted that Obaseki’s claim should be taken seriously.

Recall that Governor Obaseki had last week Thursday, told his state transition committee stakeholders at a meeting in Benin, that the printing of the ₦60billion was an indication that the country was in dire financial strait. According to him, “Nigeria has changed. The economy of Nigeria is not the same again whether we like it or not. Since the civil war, we have been managing; saying money is not our problem as long as we are pumping crude oil every day.

“So we have run a very strange economy and strange presidential system where the local, state and federal governments, at the end of the month, go and earn salaries. We are the only country in the world that does that. Everywhere else, the government relies on the people to produce taxes and that is what they use to run the local government, state and the federation.

“But with the way we run Nigeria, the country can go to sleep. At the end of the month, we just go to Abuja, collect money and we come back to spend. We are in trouble, huge financial trouble. The current price of crude oil is only a mirage. The major oil companies who are the ones producing are no longer investing much in oil. Shell is pulling out of Nigeria and Chevron is now one of the world’s largest investors in alternative fuel, so in another year or so, where will we find this money that we go to share in Abuja?

”When we got FAAC for March, the federal government printed an additional ₦50-₦60 billion to top-up for us to share. This April, we will go to Abuja and share. By the end of this year, our total borrowing is going to be between ₦15 and ₦16 trillion. Imagine a family that is just borrowing without any means to pay back and nobody is looking at that; everybody is looking at 2023, everybody is blaming Mr. President as if he is a magician.”

However, debunking Obaseki’s claim on Wednesday, minister of finance, budget and economic planning, Zainab Ahmed, said “The issue that was raised by the Edo State Governor for me, is very, very sad because it is not a fact. What we distribute at FAAC is revenue that is generated; and in fact, distributed revenue is public information”. Ahmed, who was speaking with state house correspondents in Abuja noted that “We publish revenue generated by FIRS, the Customs and the NNPC and we distribute at FAAC. So, it is not true to say we printed money to distribute at FAAC; it is not true.”

The CBN and the finance ministry had three days ago, denied knowledge of the governor’s claim of ₦60 billion printed currency. Spokesperson of the CBN, Osita Nwanisobi, told newsmen on Sunday that “I am not aware of that” while Yunusa Abdullahi, media aide to the finance minister, advised journalists to direct their questions to the governor. Abdullahi said “Please direct your questions to the governor who made the claim or the CBN”.

But firing back at the minister in a personally signed statement on Thursday, Obaseki stood his ground, stating that time would judge everyone. The statement read: “While we do not want to join issues with the Federal Ministry of Finance, we believe it is our duty to offer useful advice for the benefit of our country.

“The Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed should rally Nigerians to stem the obvious fiscal slide facing our country. Rather than play the Ostrich, we urge the government to take urgent steps to end the current monetary rascality, so as to prevent the prevailing economic challenge from degenerating further.

“We believe it is imperative to approach the Nigerian project with all sense of responsibility and commitment and not play to the gallery because ultimately, time shall be the judge of us all”.

Upbraiding Governor Obaseki over his claim, care-taker committee chairman of the APC in Edo, David Imuse, a medical doctor and retired army colonel, described the allegation as “spurious, alarmist, untrue and wicked claims on Nigeria’s economy”. Imuse, in a statement signed by the assistant state publicity secretary of the party, Victor Ofure Osehobo, said with the present huge debt profile of the state, Obasaki’s allegation of massive borrowing against the federal government, is “a classic case of the Pot calling the Kettle black”.

According to Imuse, ” the true position is that under Governor Obaseki’s watch, the economy of Edo state is in dire straits with the Governor bereft of ideas about how to get it out, with a foreign debt of $300million and a domestic debt, including loans from commercial banks, the capital market, and other doubtful sources, approaching ₦120 billion as at March this year, for non-existent projects!”

The APC chairman noted that “In the past seven months, Governor Obaseki has plunged Edo state into higher debts by taking more loans which has seen a 67 per cent increase in its debt profile” stressing that “Edo State under Governor Obaseki has overtaken Rivers State as the state with the highest foreign and domestic debt in the South-South Nigeria, and is on a steady course to displace Lagos as Nigeria’s most indebted State”.

Imuse regretted that Edo State now spends more money servicing debts than on education, healthcare and infrastructure without a state cabinet and “an aged public service”, whereas other states are working assiduously at reducing the debt burden on their citizens.

“Some state governments have embarked on the reduction of their domestic debts as of the end of September 2020 according to the Debt Management Office which lists Kogi State government as having reduced the state debt from a cumulative ₦132.5 billion it was as of December 31, 2019, to ₦73, 314,904,696.35,” the APC chairman stated.

He admonished Governor Obaseki to, “use the fora created by the National Economic Council, the Nigerian Governors Forum, and the Nigerian Economic Summit, of which he is a member, to offer useful ideas, if he has any, rather than singling himself out for paediatric applause, because the management of Nigeria’s economy is not just the responsibility of one person, but that of the Nigerian government, of which he is a part”.

Also joining the fray on Wednesday, Fayose, a chieftain of the Peoples Democratic Party, PDP, who was guest on Channels Television current affairs programme, Politics Today, expressed concern that the APC government… was placing politics over governance whereas there were a lot of issues begging for attention.”

Fayose was reacting to a question on where the next president should come from in 2023. Responding, he retorted: “You saw what Obaseki said just now; that’s unfortunate. That is sad; I’m just hearing that, and I am going to respond to it. I am going to investigate before I respond to it because Obaseki is a member of the economic council. Obaseki cannot be lying; Obaseki is a beneficiary of allocation to his state. For Obaseki to be talking like this, Nigerians must take Obaseki very seriously. This APC government has mortgaged this country. We are borrowing, and borrowing and borrowing; Obaseki said something, without a means of paying back”.

But joining those carpeting the governor, former director of communication and media of Pastor Osagie Ize-Iyamu campaign organization, in the 2020 governorship election, John Mayaki, lambasted him for lacking a “sense of decorum and self-restraint especially in speech” when he ought to be “measured, factual and in full consideration of all possible consequences” of his claim.

Noting that “This claim has sent ripples across the globe, not least in the country” as “Agitated citizens who are convinced that as a Governor, Mr. Godwin Obaseki’s allegations must have been informed by his privileged access to information, have manically shared a clip of him making the wild assertions stripped of context and lacking corroboration,” Mayaki said “There are already talks of ‘hyperinflation’ and ‘Zimbabwe’. Of course this is baseless”.

According to the communication consultant, “No other member of the Governors’ Forum, including those of the opposition PDP extraction, has backed the frivolous claim. Feelers from the CBN and Ministry of Finance indicate that it is more baloney than truth spread by a man with no real idea of what he is talking about.

“As a side note, his unimpressive and quite ordinary career as a stockbroker hardly qualifies him as a seasoned or sound economic expert and critic. His mismanagement of Edo State’s economy makes for further proof. Under his watch, the state has accumulated foreign loans at an alarming rate without any commensurate improvement or growth. Several schools in the state remain closed, education is poorly funded, health is on life support, and infrastructures have slipped into decay. When the state makes the news, it is for petty feuds (like the one the Governor waged against the FG over the National Sports Festival) and violent clashes.

Economic matters are rather nuanced and not subject for political reckless talks. This makes Obaseki’s comments shameful and unbecoming of a Governor. Instead of educating the public, he chose to spread panic and apprehension that could influence investor considerations. This is detrimental and certainly not in the interest of the public who are the ultimate beneficiaries of the federal government’s investor drive”.

Positing that the picture of doom and gloom painted by Obaseki was not reflective of reality especially with the oversubscription of Nigeria’s bonds by foreign and local investors in excess of over ₦180 billion in March, Mayaki enjoined the public to listen to the facts on the Nigerian economy and “not leaders like Mr. Godwin Obaseki who lack circumspection and are driven only by political gain, even if it comes at the cost of setting the nation on fire”.

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