The Federal Government has approved a N40 billion loan facility for Lagos State Government for the development of infrastructure and education in the state, the Minister of Information, Mr Labaran Maku, said.
Maku made the disclosure on Wednesday in Abuja when he briefed State House correspondents on the outcome of the weekly Federal Executive Council (FEC) meeting, presided over by President Goodluck Jonathan.
He said the approval followed a memo brought to the Council by Dr Ngozi Okonjo-Iweala, the Coordinating Minister of the Economy and Minister of Finance, seeking approval to obtain additional credit facility from the International Development Association (IDA).
According to him, the credit facility will be in support of the Second Lagos State Development Policy Operation.
The project covers the construction of a 27km light rail, construction of schools and the construction of Adiyan Mini Water Works to provide two million gallons of water per day.
He said: “Council approved that the Ministry of Finance obtain additional credit facility of 200 million dollars from IDA in support of the second Lagos State Development Operation.
“The Council also approved an additional 42.3 million dollars as additional financing for the Lagos-Epe Secondary Education Project.
“Council further approved that the coordinating minister for the economy should execute the financing agreement on behalf of the Federal Government.
“The Council then directed the Attorney-General of the Federation and Minister of Justice, Mr Mohammed Adoke, to issue the legal opinion required to render the credit effective.’’
According to Maku, the loan has a 0.5 per cent commitment charge, 0.75 per cent service charge, an interest rate of 1.25 per cent per annum, 25 years repayment period and a moratorium period of five years.
The minister, who briefed correspondents alongside the Ministers of Federal Capital Territory (FCT), Sen. Bala Mohammed and Transport, Sen. Idris Umar, said the Council also approved the award of contract for operation, maintenance and training staff for Wupa Basin Sewage Treatment Plant.
He said the plant would gulp N6 billion, with a completion period of 20 months.