A breakdown of the first tranche of Paris Club refunds paid to states to date has been released by the Nigerian federal government.
In the released figures, payments totaling a staggering sum of N516.38 billion, were made to the 36 states and the Federal Capital Territory.
According to a statement by Salisu Danbatta, director of information in the Ministry of Finance, the payments were accordingly made upon the approval of President Muhammadu Buhari on November 21 2016.
Premium Times reports that the Paris Club refunds were payments made in partial settlement of longstanding claims by Nigerian state governments relating to over-deductions from their Federation Account Allocation Committee (FAAC) allocation for external debt service arising between 1995 and 2002.
“The funds were released to state governments as part of the wider efforts to stimulate the economy and were specifically designed to support states in meeting salary and other obligations, thereby alleviating the challenges faced by workers,” the statement said. The Paris Club debt payment deal was sealed in October 2005.
It involved the repayment of $12.3 billion, instead of $30.4 billion. Out of the $30.4 billion, Nigeria was expected to pay only $6.3 billion (arrears & levelling up) and another $6billion (post cut-off date debt and debt buy-back), while the creditors agreed to cancel $18 billion, an overall debt reduction of about 60 per cent.
Here is a breakdown of the refunds made to states: