Nigeria’s debt profile and impunity - Punch Newspapers

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Nigeria’s current debt profile, debt to revenue ratio and proposals for continued borrowing speak to a number of perverse and negative developments. It is a manifestation of impunity and lack of respect for laws and policies. This affirms the very poor quality of leadership across board.

Enter the President, Major General Muhammadu Buhari and his team who took the borrowing binge to the next level; it became an article of faith and the mindset is that Nigeria cannot survive without borrowing. We have reached the level where we borrow to pay salaries, to fund capital expenditure and overheads because we currently use over 97% of earned revenue to service debts.

The second part of the impunity is that the Act mandates the executive and legislature to maintain the national indebtedness at a sustainable level. Upon any construction or interpretation of the concept of sustainability, a debt level that ensures that 97 kobo out of every earned 100 kobo is used for debt service cannot be stated to be sustainable. This is a clear violation of the FRA.

The fifth part of the impunity is the funds generated from borrowing are not even programmed in a transparent and value for money approach. We have road and railway projects which from comparative information available are double the costs of similar projects in Africa, Asia, and Latin America. And this is happening under an anti-corruption regime.

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