By Aaior K. Comfort

The Osun State Government has attributed its high debt service payment to the devaluation of the Naira, clarifying that the increase in debt repayment is not due to new borrowing but rather the impact of the weakened currency.

Commissioner for Information and Public Enlightenment, Mr. Kolapo Alimi, made this clarification in a statement issued in Osogbo. His remarks came in response to a report by the National Bureau of Statistics (NBS), which listed Osun State as the 10th highest among states with substantial debt service payments.

Alimi explained that the apparent rise in the state’s monthly loan repayments, particularly on foreign loans, is directly tied to the fluctuating exchange rate between the Naira and the U.S. dollar. “The repayment on foreign loans is done based on the prevailing exchange rate of the local currency,” he stated.

The commissioner further noted that Osun’s high level of debt was inherited from the previous administration, which accumulated significant local and foreign debts over 12 years. As the Naira continues to weaken, the value of monthly loan repayments in Naira terms has naturally increased, affecting not just Osun, but all states with foreign loan portfolios.

Alimi emphasized that this increase in debt service is a consequence of the nation’s economic conditions and not due to any recent borrowing by the current administration.