By Metohuey Michael Adoglo
The Centre for the Promotion of Private Enterprise has said that Nigeria’s debt, including that of the Asset Management Corporation of Nigeria and borrowings from the Central Bank of Nigeria, can hit N50tn within the shortest possible time.
The Chief Executive Officer, CPPE, Dr. Muda Yusuf, said this during an event to present the 2022 first quarter economic review of CPPE in Lagos on Monday.
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Yusuf also advocated concessionary financing for the country, as opposed to commercial debts which are expensive.
He said, “The rising debt profile of government raises serious sustainability concerns. The Debt Management Office had reported that total public debt was N39.56tn as at December 2021. About 11.3 per cent of this debt is owed by the states and FCT.
Although government tends to argue that Nigeria does not have a debt problem, the country has a revenue challenge, he said.
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He explained that debt would typically become a problem if the revenue base was not strong enough to service it sustainably.
Government’s actual revenue could hardly cover recurrent budget, which implies that the entire capital budget and part of recurrent budget are being funded from borrowing which is not sustainable, he said.
He said, “We cannot continue to increase borrowing on account of the relatively low debt/GDP ratio.
The former Director General of the Lagos Chamber of Commerce and Industry said it was imperative for the country to operate as a true federation which it claims to be.
The views and opinions expressed in this article are those of the author’s and do not necessarily reflect those of Africanian News.