With less than a year remaining in his tenure, Lagos state governor Babajide Sanwo-Olu has asked the state House of Assembly to approve plans to raise ₦200bn through a bond issuance and secure about $17m in infrastructure financing to accelerate key capital projects before his administration ends.
The requests, contained in two separate letters signed by the commissioner for finance, Abayomi Oluyomi, were presented to lawmakers on Tuesday and read during plenary by the clerk of the House, Adenike Oshinowo.
Speaker Mudashiru Obasa referred both proposals to the joint committee on Economic Planning and Budget and the Committee on Finance for scrutiny, directing the panels to submit their findings on Thursday.
One of the requests seeks legislative approval for Lagos to participate in the Federation Account Allocation Committee (FAAC) Receivables Discounting Programme under the Lagos State Infrastructure Finance Fund, a financing arrangement designed to unlock immediate liquidity by using the state’s future FAAC allocations as collateral for infrastructure spending.
Oluyomi said the initiative would allow Lagos to access about $17m in third-party funding for critical development projects.
“The programme is designed to provide immediate liquidity for the state by leveraging future FAAC allocations to finance critical infrastructure and capital projects,” the commissioner said in the letter.
He added that a formal resolution of the House of Assembly was required before the programme could be implemented.
In a separate proposal, the state government is seeking approval to issue a ₦200bn Series V bond under its existing ₦1tn Debt and Hybrid Instruments Issuance Programme.
According to Oluyomi, Lagos has long relied on the domestic debt capital market to finance large-scale infrastructure and social investment projects intended to support economic growth and urban development.
The proceeds of the proposed bond, he said, would be channelled into a range of priority projects, including the New Massey Children’s Hospital, Lagos Island General Hospital, the Lagos Rail Mass Transit Line, the Omu Creek Bridge and other strategic infrastructure across the state.
The commissioner urged lawmakers to approve the requests to enable the government to complete the necessary arrangements for accessing the capital market.
He also assured the Assembly that the borrowing plans would be managed within the state’s framework for prudent fiscal management and sustainable infrastructure financing.
