The recent statement made the Minister of Works, Power and Housing, Babatunde Fashola that “those who complain we [Federal Government] borrow too much should tell us where else to find funds” is not only unfortunate but alsoa glaring admission of cluelessness.
While it is distressing to watchthe country’s debt profile balloon into pre-2006 levels – before the debt buyback deal when the Obasanjo administration paid $12 billion to eliminate over $30 billion then owed to the Paris Club of creditors -, it is disheartening that the Buhari government seems to be bereft of ideas on what to do to generate revenue without resorting to excessive borrowing.
The statement by the minister further shows that the government is not planning on cutting down on its borrowing spree anytime soon even though the country’s debt stock stands at a staggering $22.4 trillion as at June 30, 2018. As it is, Nigeria pays huge sums each year in debt servicing. We recall that even the IMF, its traditional ally in loan/borrowing has come out to caution the Nigerian government on its borrowing level repeatedly and advised it to cut down on this as it noted that the country’s debt presently at 63% of its revenue is extremely high. Regrettably, this warning has so far not been heeded; rather,the government continues to live in denial while enmeshed in relentless borrowing.
For the minister and his co-travellers, the question is; how does he account for the trillions of Naira in borrowed funds that have been supposedly sunk into the country especially in its power sector, without any visible results? Are we not leaving a debt burden for our children and future generations?
Taking into account the capacity of the country to bear the rising debt stock and the burden of debt servicing, Social Action had long before now recommended practical measures to halt these excessive borrowings while it urged government work to improve non-petroleum revenues. The publication entitled: ‘Whose Burden? Examining the Growing Public Debt Crisis in Nigeria’, Published in 2015, contains recommendations that are even more compelling today.
We again assert that borrowings will not be warranted if the government cuts down on frivolous expenditures such as are strewnall over the budget, manage generated revenue including recovered loots properly, plug leakages, strengthen tax collection capacity and tackle corruption effectively.