Finance Minister Defends Nigeria’s Increasing Debts

Nigeria’s Finance Minister, Mrs Zainab Ahmed, has said that while the government borrows so it can deliver its promises to the citizens of the country, the government is also mindful of the increasing incurred debt, which takes about 25 per cent of the country’s annual income.

Mrs Ahmed made this known during an interview with the News Agency of Nigeria (NAN) at the just concluded IMF/World Bank meetings, at Washington DC from 9th of April to the 14th .

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As at December 31, 2018, Nigeria has an external debt of over 24.27 billion dollars.

Currently, debt in Euro bonds, loans from China, World Bank, and the Africa Development Bank Group make up over 80 per cent of the Nigeria’s debt stock.

Mrs Ahmed said emphatically that in spite of warnings by the International Monetary Fund and the World Bank group, Nigeria was not in any kind of near financial crisis, as we are still within the fiscal policy.

In her words: “The World Bank and IMF are cautioning us on the rate at which we are borrowing.

“They are also cautioning us on the need to build fiscal buffers because the global economy is going to be facing some risks and we agree with that.

“We are very mindful of the level of our borrowings. Our borrowing is very much within fiscal limits right now”.

According to Mrs Zainab, Nigeria is doing all it can to increase its income capacity, so as to meet all its debts demand.

“What we are doing is to increase our revenue-generating capacity to make it easier for us to meet our debt obligations and our routine as well as capital expenditure,’’ she mentioned.

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A NAN Correspondent raised concerns about the loans obtained by the county from Chinese to finance projects such as the Lagos-Ibadan, Idu-Kaduna, expansion of four airport terminals, the Abuja light rail projects, as well as other hydroelectric projects set to be committed across the country.

He asked if these loans were the best way to go for the nation’s economy, especially considering the level of debt the county is in presently.

Mrs Ahmed responded to the questions by saying: “To borrow, we go through several processes of assessments as well as negotiations.

“We make sure we get the best possible terms and whether we are borrowing from financial institutions or in Europe or China or anywhere else, we try to get the best rates of borrowing.

“So far, the conditions we’ve got are very good ones,’’ she remarked.

She also emphasized the resolution of the President Muhammadu Buhari-led administration to ensure that the country develops in a manner that would bring a lot of people out of penury.

According to her, this is the sole reason the Buhari lead government has taken it upon itself to invest in social programmes such as feeding of school children, Conditional Cash Transfers to the less privileged as well as and the trader moni program.

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