The immediate past governor of Kwara State, Alhaji Abdulfatah Ahmed has dismissed recent claims that his administration guaranteed bank loans for Shonga Farm Holdings (SFH) as “uninformed and false”.
Media Aide to the former governor, Mr Wahab Oba, said in a statement on Friday in Ilorin that the Bukola Saraki administration did not guaranty any loan for the farm.
Ahmed, who was Commissioner of Finance when Shonga Farms was established and whose administration created Harmony Holdings Limited, SFH’s supervisory company, said Shonga Farms is a Public Private Partnership (PPP) project.
It was funded under a debt-equity structure and owned by the State Government, a consortium of banks and the Zimbabwean farmers.
The former governor maintained that the Kwara government invested in the project through infrastructure for the farms and its communities such as roads, electricity, water and security infrastructure that are still intact.
SFH, he revealed, secured bank loans for expansion using its assets as collateral, adding that a state government can only guarantee a loan through its federal allocation, which was never pledged.
Ahmed reiterated that not all businesses are thriving, stressing that while the poultry business remains viable, the dairy syndicate stagnated when a global milk company cancelled its off-taker arrangement with SFH.
The mixed crop section, he explained, stalled due to irrigation problems as a result of federal governnent’s renege on its promise to assist with irrigation.
The ex-governor however said some of the farms secured new investment to pay off their loans to the banks through SFH, which has paid over N600 million out of an outstanding N900 million to AMCON.
He therefore exonerated the previous two administrations of any wrongdoing in exploiting a business opportunity that attracted investments into the state, developed the local community and placed the state on the global map.
According to him, SFH attracted foreign and local investments above 100 million USD and has created over 4,000 direct and indirect local jobs, besides knowledge transfer to the local community.
He maintained that his and the Saraki administrations followed due process in all transactions relating to SFH, a quality that earned the state government a high ranking from the global rating agency, Fitch.
While acknowledging that the SFH financing model was innovative, Ahmed advised the state government to seek clarifications from professionals rather than indulging in theatrics capable of discouraging investment in the state.
The former governor also urged the state government to focus on surpassing investment inflows recorded during the previous administrations, including Dangote Industries and BUA Sugar Company.