FG To Settle N187.32bn Contractors’ Debt This Year

The administration of President Bola Tinubu will likely spend about N187.32bn to settle debts owed to local contractors this year.

The debts were listed as promissory notes in a document titled, ‘Schedule of promissory notes issued by category as at September 30, 2022’ by the Debt Management Office (DMO).

According to Investopedia.com, a promissory note is a debt instrument that contains a written promise by one party (the note’s issuer or maker) to pay another party (the note’s payee) a definite sum of money, either on demand or at a specified future date.

Section 4 of the Government Promissory Notes Act states that government promissory notes are paid from the general revenue and assets of the federation.

It read in part, “The principal sums and interest represented or secured by any government promissory notes are hereby charged upon and shall be payable out of the general revenue and assets of the federation.”

Economic Confidential observed that two promissory notes were issued to settle local contractors.

The first was issued on November 23, 2020, while the second was issued on July 12, 2021.

The debt payment is expected to be in naira, dollar, and euro, according to the document from the CBN.

The naira liability is N57.83bn, the dollar liability is $26.48m (N19.78bn), and the euro liability is €133.76m (N109.71bn).

Both promissory notes were expected to be settled by November 23, 2023.

It was earlier reported that the Federal Government owed contractors about N11.16tn for the construction of various highways across the country and certificates of completion.