The debt burden and how we got there

Nigeria’s debt stock increased by three per cent from the N21.68tn recorded in December 2017 to N22.4tn recorded in December 2017 and to N22.2tn ($73.21bn) at the end of June 2018. The Director-General, Debt Management Office, Patience Oniha, made this known at a media briefing in Abuja on Tuesday, August 14, 2018.

She said the nation’s debt stock decreased by 1.44 per cent from N22.7tn recorded in March 2018 to N22.38tn in June 2018. The decrease was largely due to a 3.38% decline in Nigeria’s domestic debt stock between March and June 2018. There was also a marginal increase of 0.07% in the external debt stock and 2.75% in the domestic debt of states.

But speaking on October 28 at the 9th public lecture of Sigma Club at the International Conference Centre, University of Ibadan, Vice President Yemi Osinbajo said the nation’s debt was $73bn, a $10bn increment from $63bn the present administration inherited in 2015.

“In 2010, our debt was $35bn, $41bn in 2011, $48bn in 2012, $64bn in 2013, $67.7bn in 2014, $63.8bn, $70bn in 2017 and N73bn in 2018.

“The nation’s debt as of today is $73bn, an increment of $10bn from the $63bn inherited in 2015”, he said.

There is nothing wrong in securing a debt. But there is everything wrong if you cannot justify what you have done with the debt either as an individual or a company or as a nation.

And the sad thing is that the money that Nigeria has borrowed now as foreign debt has been relooted  back to Europe, America and Asia by our leaders making us, our children and grandchildren to face the future as perpetual captives. We are talking about a country where especially in the rural areas there is no government presence—a clear indication of a failed state.

We are talking about a country that survived a civil war between 1968 and 1970 without borrowing a single kobo! Available records show that Nigeria did not borrow during the era of Gen. Yakubu Gowon from 1966 to 1975. In fact, record shows that the country did not borrow a kobo during the short era of Gen. Murtala Mohammed from July 1975 to February 13, 1976.

We are talking about a country which the British Prime Minister, Theresa May, on August 28, said, “Much of Nigeria is thriving with many individuals enjoying the fruits of a resurgent economy, yet 87 million Nigerians live below one dollar and 90 cents a day making it home to more poor people than any nation in the world.” We are talking of a nation which a former Minister of Finance, Mrs. Ngozi Okonjo-Iweala, said earned $61.7bn between 2011 and 2014.

Nigeria’s foreign indebtedness started during the military regime of Gen. Olusegun Obasanjo in 1977. The government first borrowed N600m ($1bn) which was followed with another huge borrowing of N734m ($1.456bn) in 1978. Thereafter, there was borrowing by both the federal and state governments which later aggravated the Nigerian debt problem.

 

Culled from Punch