26th August, 2011
The Governor of Delta State, Dr. Emmanuel Uduaghan, says the state has gone to the capital market to source for funds to cushion the effects of the new minimum wage on its revenue.
Uduaghan disclosed this on Thursday in Asaba, when the Chief Executive Officer of the Nigeria Stock Exchange (NSE), Mr. Oscar Onyema, visited him.
Uduaghan said that the state was seeking to raise N100 billion through bonds for its capital projects.
The governor explained that the stateâ€™s current revenue profile would only be enough to pay the new salaries to workers.
â€œWe decided to go to the stock market to source for funds because of the shortage of revenue we will be facing due to the new minimum wage which figure is hitting roof tops,â€ the governor said.
He explained that the state resorted to the capital market for funds because it was now difficult to borrow from the banks, adding that the bonds would be in two tranches of N50 billion each.
He said that the money would be used to provide infrastructure in the state.
The governor expressed gratitude to management of NSE for helping out with the bonds and assured them that the funds from it would be judiciously spent.
Uduaghan appealed to NSE to educate businessmen on how to access funds from the capital market for the improvement of their ventures.
He disclosed that some Greek investors were in that state with 100 million dollars (about N15 billion) for the establishment of a banana farm.
He stated that the land required for the size of farm envisaged by the businessmen was large and that the government had begun the search for an appropriate location for the project.
He also announced that the state would host the South-South Economic Summit before the end of the year and solicited the support of the NSE.
Onyema told the governor that he was in the state to discuss issues associated with the bond.