Lagos to borrow $200m from World Bank in 2014

The Lagos State Government will next year draw down second tranche of $600 million loan approved by the World Bank under a development policy operation (DPO) scheme for which it applied in 2010 and approved by the National Assembly.

This fund is part of the basket of financing for the ambitious 10-lane Lagos- Badagary Expressway.

The scheme, according to the borrowing plan, is to be implemented in three tranches by the state government. Accordingly, the first tranche of $200 million from the $600 million loan was obtained by the state in 2011.

In a letter addressed to Senate President David Mark and read on the floor of the chamber yesterday, President Goodluck Jonathan urged the Senate to include the second tranche of the scheme into the current borrowing plan.

The president explained that the borrowing plan was not captured in the 2012-2014 medium term borrowing which he earlier submitted to the parliament.

'The World Bank has therefore embarked on restructuring of the project in the face of current realities in a manner that would release US$200 million for allocation to Lagos Development Policy Operation II. This is an action that the World Bank with the support of its board can undertake. They propose that the US$200 million DPO would enable the state complete some critical infrastructure projects,' Jonathan said.

The president further explained that when the loan is obtained, the state government plans to use it for the construction of ultra-modern burns centre and cardiac and renal centre at the Gbagada General Hospital as well as the 27-kilometer light rail project along Lagos-Badagry Expressway Corridor to Marina.

The balance, he said, would be used for the completion of $70 million gallon per day Adiyan Water Facility, among others.

The president while pleading with the lawmakers to accommodate the plan in the nation's borrowing plan, further disclosed that doing so would enable Lagos State to consolidate on the gains of the first tranche of the credit without any fresh implication to the borrowing plan.

Also yesterday, the Senate congratulated the president on the election of Nigeria as a non-permanent member of the United Nations' Security Council for a two-year term with effect from January 1, 2014.