Ministers differ, lament on Nigeria’s debt ratio.
Written by crest887fm on June 24, 2021
The Minister of Finance, Budget and National Planning, Zainab Ahmed, and the Director General of the World Trade Organisation, Dr Ngozi Okonjo-Iweala, yesterday, differed on the nation’s debt-to-Gross Domestic Product ratio.
While Ahmed put the debt-to-GDP ratio at 29 per cent, Okojo-Iweala said it had risen to 35 per cent.
Both the minister and the WTO boss spoke at the African Development African Development Bank High Level Knowledge Event with the theme: ‘From Debt Resolution to Growth: The Road Ahead for Africa’ which held virtually.
Ahmed also disclosed that Nigeria planned to borrow more money to fund its infrastructure capacity.
This is in spite of voices calling on the government to halt borrowing and concentrate on other means of raising funds for the infrastructure needs of the country.
According to the Debt Management Office, Nigeria’s total public debt portfolio rose from N12.12tn in June 2015 to N33.11tn as of March 31.
Ahmed said the government was enforcing fiscal discipline to expand its fiscal space so that it could continue to service its debts and borrow more to build the nation’s infrastructure capacity.
However, Ngozi Okonjo-Iweala, who also attended the AfDB’s event, differed with Ahmed on the nation’s debt-to-GDP ratio.
The WTO boss who had been Nigeria’s Minister of Finance in the past said the nation’s debt to GDP ratio had risen from 29 per cent to 35 per cent.
Okonjo-Iweala also said that scarce foreign exchange in certain African countries was creating scenarios where the governments were using scarce forex to fund the fund debt repayment rather than on capital investment.
A professor of economics at the Olabisi Onabanjo University, Ago-Iwoye, Ogun State, Sheriffdeen Tella, described as a cause for worry the amount being spent by the government on debt servicing.