• $250bn needed to tackle infrastructure deficit
Director General of the Debt Management Office (DMO), Abraham Nwankwo, yesterday, put Nigeria’s debt profile at $64 billion. He, however, assured that the debt would not affect the economy, contrary to claims by some financial experts.
Nwankwo equally explained that the N1.2 trillion domestic borrowing and foreign loan of N635.88 billion proposed in the Medium Term Expenditure Framework (MTEF) for the 2016 fiscal year, was also okay for the country’s development.
Nwankwo said this when he appeared before the Senate Committee on Foreign and Local Debts, explaining that 84 percent of the entire debt profile was owed locally while the remaining 16 percent was foreign.
He added that $25 billion was needed per annum continuously for the next 10 years to effectively tackle infrastructure deficit in the country.
He, however, explained that debts owed local contractors were not part of the domestic debts listed because their details were under the purview of the Budget Office of the Federation and National Planning. He said they were operational debts.
“Even before the collapse of oil prices, it has been estimated, more than five years ago that Nigeria needed a minimum of $25 billion per annum continuously for up to 10 years to enable it close its infrastructure deficit.
“That has been established by all relevant experts, and institutions. In addition, the collapse of the oil prices by our own estimate shows that public revenue from oil had dropped by about $16 billion per annum.
“In this type of situation, what a responsive government should do, and which is what our government is doing is to make sure that it counteracts a continuous decline in economic activities…
“Borrowing is being done to achieve positive impact on the economy, it will lead to growth, creation of employment, and build solid capacity for the future, which will help us to diversify our economy.
“What the government is planning to do now is to explore at least five out of the 34 solid minerals that we have. We will develop, and process them for export.”
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