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It was extreme shock for lawmakers’ weekend as the Director General of Nigeria’s Debt Management Office (DMO), Dr. Abraham Nwankwo announced before the Senate Committee on Local and Foreign Debts during the defence of the 2017 budget estimates of the office that the country did not need debt relief from its creditors.
The current total debt of the country stood at N17.36tn made up of external debt of $11.41bn (N3.48tn) and domestic debt of $45.98bn (N13.88tn).
According to Nwankwo, the domestic debt of the Federal Government, the 36 states and the FCT accounted for about 79.96 per cent of the total public debt stock, while their external debt stock accounted for about 20.04 per cent.
Besides, the external debt profile of the Federal Government alone rose from $10.71bn in 2015 to $11.4bn in 2016, representing an increase by 6.53 per cent.
While arguing that Nigeria has not reached the stage where it should seek for debt relief, Nwankwo said “In our humble view, Nigeria is not in a position to beg for debt forgiveness. Nigeria is still a very strong economy. We have some challenges; but Nigeria has not reached a stage that it needs to beg for debt forgiveness. We are not in that position, sir.”
But in bewilderment, a member of the committee, Senator Sani decried the increasing debt profile of the country, describing the panel as the country’s “ombudsman of debt,” and stressed that the country was going into borrowing arrangements “like no other” when in a critical condition.
Sani noted that “There are issues with how bailouts were handled by the states. There are issues on how the Paris Club refunds were handled by the states. Now, we are going into borrowing between $29bn and $30bn.
“Like I said, in the next 20 to 30 years, we will not be here but our signatures are going to be here. The next generations will ask questions about how we left behind so much debt for them.”
On why the $29bn loan request was rejected by the lawmakers, Senator Obinna Ogba argued that the rejection was based on the fact that the executive failed to convince the legislature on the need for the $29.96bn loan.
In his further submission, “The present administration is interested in borrowing more and this money they want to borrow cannot be possible without you (DMO) giving a nod for it. You supported them, advised them and gave them the green light for the borrowing, and that was why they brought it over to the Senate.”
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