Contrary to the stand of the Federal Government that the nation only has revenue challenge and not debt problem, economists and experts have said that the country has a huge debt burden.
The Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, had at a meeting with the members of staff of the ministry on Monday said that Nigeria did not have any debt challenge but a challenge with generating sufficient revenue.
Tella said, “We have a debt problem because when you have problem with debt servicing, then you have a serious debt problem. He said, “It is expected that the debt profile of the country would rise considering the fact that we have a deficit budget and even the deficit side of the budget was not met in the last budget year.“Of course, the borrowing portends danger for the economy because our debt profile is rising and we do not know when we are going to scale it down.”
He said governments could borrow as much as they would use the money “to do things that can increase productivity.” Though Nwani argued that borrowing for developmental projects was not bad, he added that the effect of borrowing on the masses was the concern of the nation’s economic experts. “Today, no concrete project is going on in the country and we keep borrowing money. Today, our GDP growth rate is 2.5 per cent but it was above five per cent few years ago. This is very weak for a country like Nigeria.“You media men need to challenge the government on the new policy on loan for importation of food, especially milk. If you raise money to import without going through the CBN, when you get to the port of entry, you will have problems.
“This government has put the country in a tight debt situation, and we need to check it. It means that further borrowing will endanger current budget implementation because for every N100 we make, we spend about N50 on debt servicing. This means that within a period of two years, the country’s total debt rose by N5.79tn. It also means that within a period of two years, the country’s debt profile rose by 30.22 per cent.
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