Umuahia — Commissioner for Finance, Abia State, Dr. Jones Udogu, has said the State government has not dropped its earlier bid to raise N30 billion from the bond marked for the $200 million World Bank loan, contrary to some media publications that the State may have jettisoned the Bond bill apparently due to some bottlenecks in acquiring the facility.

The commissioner who made the clarification during a press briefing in Umuahia said the state government was still committed to acquiring both loans.

"According to the report, which quoted the House committee Chairman on information/Deputy Speaker Hon. Chinedum Elechi, the reason to replace the Bond loan with the World Bank loan is due to the stringent terms and conditionalities that have posed some difficulties in raising the said loan from the Bond Market.

The Abia State Ministry of Finance, which is the supervisory ministry for the said bond, wishes to clarify that the State Government has not dropped the Bond loan for World Bank loan. It is true that process of obtaining loans from the Capital market is not as easy as that of the commercial banks for obvious reasons, but Government is not ignorant of the enormous advantages associated with loans from the capital market which the commercial banks cannot offer".

He said, while the World Bank loan attracts only one percent interest and payable after 20 years the bond market loan also has a very loan interest rate, hence the decision of government to settle for both options as the cheapest way of raising more funds for the development of the state.

He further explained that the funds raised from both loans would be used to re-finance the already existing projects in the state.

Mr. Udogu said the state intends to invest the loan on the erection of five - star hotel in Umuhia, market; and the building of three specialist hospitals in the three senatorial zones of the state.

The commissioner also confirmed that the state government has already obtained N700 Million loan from commercial banks for the defrayal of teacher salary arrears, while a supplementary appropriate of N6 Billion would soon be pass into law by the House of Assembly to enable the state finance the numerous developmental projects it has embarked upon.

He further assured that despite the initial difficulties encountered in the course of obtaining the loan at the bond market, the processes were almost over as the last stage which requires the approval of Mr. President would soon be completed as soon as the president comes back from hospital.