How Oyetola turned Osun from insolvency to fiscal viability, investment destination


For Osun, it was a tale of insolvency and lack of political will to change the narrative which had prompted fiscal and financial crises, snowballing into the state’s inability to undertake critical obligations such as the mandatory payment of salaries. The emergence of Adegboyega Oyetola as Governor of Osun state would later change the narrative, evolving from a state at the verge of insolvency, servicing debt with 91% of its share of Federation allocations, to being one of the fiscally and financially viable states of the federation. In less than three years that Governor Oyetola assumed office in Osun state, he was conferred with the Governor of the Year 2020 Award by BusinessDay, based on socio-economic growth data available even in the public space, writes RAZAQ AYINLA, Southwest Regional Editor.

It was on August 11th, 2020 that BusinessDay reported a story with the headline – Osun flirts with insolvency, spends 91% of FAAC servicing debt in Q1. The data driven news report showed how Osun state spent N91 of every N100 collected as revenue allocation from the Federation Accounts Allocation Committee (FAAC) to service accumulated debts that were left by Governor Oyetola’s predecessors.

It took the expertise of someone who has traversed both public and private sectors like Governor Oyetola to strike a rightful balance between servicing the accumulated debts, undertaking capital projects for good of the people, paying salaries, pensions and gratuities and many other state’s obligations in order to bring good governance to the people of Osun.

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As Governor Oyetola would say during a chat with him at his 25-year old mansion located in the heart of Iragbiji, Boripe local government area of Osun state, “it’s no surprise that we have done this much from the time BusinessDay reported that Osun flirts with insolvency, spends 91% of FAAC servicing debt in Q1 and now”.
“For BusinessDay to have reported that for every N100 we get from FAAC, N91 is used to service debt, wasn’t only analytical but also served as a clarion call on us to bequeath Osun state, a good governance,” he said.

He noted that on assumption of office, the state was reeling from the impact of the drastic fall in earning power as a result of the recession, which inadvertently put it in an uncomfortable situation financially. So, naturally there were a few challenges that sadly attempted to slow down governance.

“Upon assumption of office, therefore, we were confronted with the challenge of stabilizing our financial base to be able to deliver on our priority needs. We swung into action and ensured that we shore up our revenue base, revitalize the economy for improved performance and further position the State for optimum productivity and prosperity. I am convinced we have done well and are right on track to achieving all the goals we have set for ourselves.

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“The fact that we have also started implementing the minimum-wage and lifted the embargo on promotion of staff also excite me. I could also think about how the mining sector is being sanitized or even some of the roads we are constructing that were largely neglected for decades. Among these and many others, I think the greatest joy is our administration’s inclusive governance framework and how we have given our people a voice and made them to count in governance.

“As far as I am concerned, the challenges the state faces are not significantly different from what any other states in the country face, but what is most important really is what we are doing to address these needs. The first challenge, one may talk about is in the dwindling resources available to prosecute development needs.

“Again, for us, this is being tackled frontally by ensuring that we revitalize and sufficiently diversify to open-up new channels of wealth creation. What we have done in the last few months is to aggressively open-up new revenue vistas through effective tax collection while leveraging on our capabilities in agriculture, tourism and mining. Through our reform efforts, we are beginning to see results in these areas as significant contributors to our economy”, the governor said.

Corroborating Governor Oyetola’s comments, Olalekan Yinusa, a professor of Economics and Commissioner for Budget and Economic Planning, noted that it could only take combined robust experience and exposure in both private and public sectors for the governor to achieve thus far, saying:

“I have had reasons at the State Executive Council meeting to stand to appreciate him for the fact he has been very consistent with his promise to the people.
“Osun is not known to be fiscally rich in terms of money but I must tell you Osun is very rich in terms of ideas, creativity, and innovation in the public sector. Most of the programmes that are now high flyers at the national level, most of them emanated from the state.

“The governor was solidly prepared for the position; he was chief of staff for eight solid years after spending over 30 years in the private sector. So, a blend of public and private sector experience at that level, you will understand why I said that he was prepared for the position that he is occupying today.

“The question has always been that how have we been able to do some of the things we have done, I must say that because of all those backgrounds, he brought those experiences in terms of deployment of resources and application of funds to the various budgets and programmes to meet the need of the people.

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“People kept asking how we pay salaries, even at the peak of the lockdowns, Osun was paying salaries and that is strange, it is because the governor has been very innovative, creative and this has been responsible for everything we are doing. No investor will go to a place where there is no peace, so within a short period of time, he has been able to attract interesting investments to the state of Osun.

“The ethanol company is here because of the goodwill of the governor and character of the state, mining is also ongoing in the state. A lot of manufacturing activities are about to start at Omoluabi Free Trade Zone and Dagbolu International Trade Centre as well as other investment programmes that Osun State Investment Promotion Agency (OSIPA) and Omoluabi Holdings are doing.

“People requested for good health system, infrastructure, human capital development and security. principally the governor aspires to make sure people are educated, healthy, have access to and get efficient health services.

“Immediately the Governor assumed office, he had to make sure health is accessible and affordable. He set out to make available 332 health facilities, one primary health centre per political ward. As I speak to you, all 332 health facilities have been completed because what the governor wanted was that people did not have to travel before they receive health care services.

“This means that health facility is at a walking distance from anybody’s home and they are able to receive services without any problem.”
Adebayo Jimoh, chairman, Board of Directors, Living Trust Mortgage Bank PLC, lauded the State Government’s focus on critical infrastructure, agriculture, mining and tourism to attract huge investments to the State, beginning from ongoing Dagbolu Inland Container Terminal, which he said, is the brain child of the Living Trust Mortgage Bank PLC.

He said: “We at the Living Trust Mortgage Bank PLC, which is a merger between Osun State Government and Cititrust Financial Services, are supporting the Dagbolu International Trade Centre and Dagbolu Inland Container Terminal on the Osogbo-Ikirun highway.We are having partnerships with Nigeria Railway Corporation, Nigerian Ports Authority, Nigerian Shipping Council, Federal Ministry Industry, Trade and Investment and other investors.

“We are constructing Dagbolu Inland Container Terminal that will run on Lagos-Kano rail to decongest ever congested Apapa port and attract unprecedented investments to the State of Osun. Attracting investments and providing security are what Governor Gboyega Oyetola’s Administration is much focused about and we are doing several things at a go to develop and sustain the socio-economic activities ongoing in our State.”
Folorunsho Bamisayemi, Commissioner for Education, also said that there had been a total overhaul in education sector as morale of teachers has been boosted with full salaries as against the half salaries paid by the previous administration.

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Just as artisanal means of livelihoods has been restored by breaking monopolistic market of school uniforms sewing and supply that was hitherto handled by one firm – Omoluabi Garment, to thousands of tailors and fashion designers across the 30 local government areas domiciled in the state.

He said, “On welfare of teachers, you all know Osun was paying half salaries. By the Grace of God, Osun state is consistently paying its teachers full salaries and that has played a big role because the teachers are motivated and happy, even with the giant strides in other sectors and the giant debt left by the previous Administration
“The governor is still able to pay full salaries and also paying gradually the outstanding debts, pensions and gratuities. We have a listening governor who places people’s lives above brick and mortal projects.”

“Our primary activities and core competence are mortgage services and financing of major capital projects in housing. We are also committed to the development of housing scheme, we financed the completion of Osun Shopping Mall and currently, we are, in partnership with the Osun State Investment Promotion Agency (OSIPA), constructing mass housing in major cities of Osogbo, Ife, Ilesa, among other major cities in all the 9 Federal Constituencies in the State.”

For those who are asking for the magic behind Governor Oyetola’s bringing back the good time and fiscal viability in Osun, Adegbite Ademikaran, Chairman of Osun State Internal Revenue Service (OIRS), said, “The magic is the leadership the Governor of the State because he gave us the freedom to come up with strategies and each time we present those strategies to him, he has never hesitated to approve our strategies.
“And one of those we did in recent times that have assisted us in blocking those leakages, what we are talking about is that we have deployed some form of technologies, most times if your collection is being done manually or you are collecting cash here and there, there is probability of people surpressing cash and all this revenue leakage will be very high.

“Last year our target was N24 billion and you know we had issues and of course the negative impacts of COVID-19, if this issue didn’t arise we would have met our target, that is why I said if you extrapolate what I gave you, N18 billion in 9 months, effective 9 months and so we could have done N24 billion, our target last year was 24 billion and I think we did close to about 86% of our target.”


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