These guys will drown us in debt
They are even using Yaradua's name to justify it! Are they still using Yaradua's ministers. Or are they implementing Yaradua's 7-point agenda!
Sometimes I wonder why they are looting so furiously. The argument they have always used to ruin us are "concessionary loan" and "critical infrastructure" as if the poor will be able to afford the infrastructure when they must have finished building them
Yes this government invented professionalism and modelling. "The oil benchmark is a professional issue underpinned by a model". But we know every model has its limitations

http://www.thisdaylive.com/articles/fg-unveils-9-3bn-external-borrowing-plan/129808/
Onwuka Nzeshi
The Federal Government Monday proposed a portfolio of concessionary loans totalling $9.3 billion under its 2012-2014 Medium Term External Borrowing Plan and requested the National Assembly to consider and approve it.

The proposal consists of an initial request of $7.9 billion which has been pending before the parliament and an additional $1.4 billion comprising a $300 million loan for water supply schemes in selected states, a $1 billion Euro bond and $100 million Diaspora bond which will be issued next year.
As at September 30, 2012, Nigeria's external debt stock stood at $6.2 billion, while her domestic debt was put at N6.3 trillion.

Coordinating Minister for the Economy and Minister of Finance, Dr. Ngozi Okonjo-Iweala, unveiled the new borrowing plan at a meeting with the members of the House Committee on Aids, Loans and Debts who had invited her to clarify the position of the executive on external borrowings.

The minister appeared alongside the Director General, Debt Management Office (DMO), Dr. Abraham Nwankwo, and other top officials of the Federal Ministry of Finance.

She allayed the fears of the lawmakers that Nigeria was returning to the old era of amassing huge external debts, just a few years after she exited from the grip of the Paris Club.
She explained that the loans were not only necessary for the Nigerian economy to grow but have been negotiated with multilateral institutions on highly concessionary terms.

Okonjo-Iweala said that having been involved in Nigeria's struggle to exit the Paris Club at great pains in 2005, it would be unthinkable for her to lead an Economic Management Team that would drag Nigeria back to that unfortunate economic era when Nigeria groaned under the debt burden.

According to her, the country’s debt to GDP ratio would remain at a sustainable level of about 18.87 per cent, even with the new loans.

“We are proposing three amendments to this external borrowing plan. We have an amendment to provide for a water supply project in Rivers State to the tune of $200 million
.
“This will be supported through the ADB (Africa Development Bank) through a concessionary loan with a 40-year maturity, 10-year moratorium and at 0.7 per cent interest rate.

“We also propose to swap some of the existing loans in this plan to take them out and substitute in their place, a facility to kick start a Housing Mortgage Finance Scheme in Nigeria to the tune of about $300 million.
“The final thing is for a Euro-bond issue of $1 billion. You will recall that during President Umaru Musa Yar'Adua's administration, plans were initiated for the first Euro-Bond.

“Preparation started and it was successfully floated at the beginning of January 2011. It was highly successful and was 200 per cent over subscribed.

“So this Euro-bond is a continuation of what was started by the previous regime and we just wanted to bring that to your attention that in addition to this borrowing plan, there is a plan for Euro-bond of a billion dollars.
“There is also a $100 million Diaspora bond to attract Nigerians in the Diaspora to bring their money back to invest in infrastructure,” she said.


On the vexed issue of an appropriate benchmark for the price of crude oil in the 2013 budget, Okonjo-Iweala appealed to the lawmakers not to politicise the issue but to look at it from its technical and professional nature.

In other countries like Chile, she said, the benchmark for copper, the main product of the economy, is determined by a special technical board assembled for that purpose and not subjected to debate in parliament.
She said going forward, Nigeria may have to assemble such a technical team to determine the oil benchmark to save the nation the time wasted in haggling over the benchmark of oil every year.

“I urge our lawmakers to bear with us because the oil benchmark is purely a professional and technical issue underpinned by a model. It is not a political issue and I think we should not politicise it,” she said.

We are burrowing to pay back with high interest rates,yet we are creating a sovereign wealth fund to save money
Sounds like penny wise ,pound foolish to me.

“This will be supported through the ADB (Africa Development Bank) through a concessionary loan with a 40-year maturity, 10-year moratorium and at 0.7 per cent interest rate.

Also I doubt the effectiveness of the above quote credited to her
Are interest rates that low for such a maturity date?
Nigeria currently pays between 13-17% on burrowed money used to service her bonds while Spain ,Italy and Portugal are shying away from 6-7%burrowing costs, yet ADB is offering 0.7% interest rates and we still burrow at 13-17%
Yet there are no visible changes in infrastructural development
Is this not the same Ngozi who spoke of SURE-P once upon a time?
Nigerian politics and Economics are so similar, the more you see the less you understand it

Hmmm,

dats wor i call BORROW POSE

He who goes a borrowing, goes a sorrowing.. I pity Nigeria

I am inspired by Nigeria to start taking loans from banks randomly. I do not support this borrowing, we should not be in a hurry to develop infrastures if we do not have the financial muscle. This is absurd.

Abeg make dem borrow make money circulate for we hand!Afterall we get plenty oil for ground! Madam Ngozi hammer them loan request jo!

Does anyone know where I can get Cycling protective Helmets for my Team? I want to buy them today. Sorry for derailing the Topic

Mr. FG When will you stop to morgage our children future?

Firstly there is not wrong in borrowing what is wrong is that more than half of thr money will end up in private pocket. Nigeria currently borrows at 14 percent and like someone said earlier spain Greece and portugal are crying becos they pay interest of less than 7 percent. The water scheme as far as I am concern is unnecessary becos most household in Nigeria use borehole. I think our economy planner does not know the right project to generate the much needed jobs

D generation yet unborn are in deep shi.t!

This is toooooooooooooooooo much na! the other day i saw a total revenue taxes for third quater that can service our budget but seeing this one again looks strange. the borrowing is toooooooooooooooo much. been indebted always is not the best

I have a feeling that this government is in a hurry to rush us into more debt, dont they
know the evil called interest rates?, they keep telling us about low debt to GDP ration , while we
keep on having debt servicing costs as the highest part of our Budget(591 bn!!! ).BTW no one is telling us
what critical infrastructure is.Even documents from the DMO site show current debt obligations of the
FG surpasses the Figures being reeled out here.

Well if the debt issue turns ugly in the future we can always blame Yar'Adua.

we practice DEMOCRATIC ECONOMY

nomshu: This is toooooooooooooooooo much na! the other day i saw a total revenue taxes for third quater that can service our budget but seeing this one again looks strange. the borrowing is toooooooooooooooo much. been indebted always is not the best

Abeg no worry yourself! Nothing too much woo! America has a debt of more than 15 Trillion Dollars and yet is one of the countries wey everyone wan go hammer life and considered to be the best country on earth. Debt no go kill Nigeria!

ochukoccna: We are burrowing to pay back with high interest rates,yet we are creating a sovereign wealth fund to save money
Sounds like penny wise ,pound foolish to me.

Also I doubt the effectiveness of the above quote credited to her
Are interest rates that low for such a maturity date?
Nigeria currently pays between 13-17% on burrowed money used to service her bonds while Spain ,Italy and Portugal are shying away from 6-7%burrowing costs, yet ADB is offering 0.7% interest rates and we still burrow at 13-17%
Yet there are no visible changes in infrastructural development
Is this not the same Ngozi who spoke of SURE-P once upon a time?
Nigerian politics and Economics are so similar, the more you see the less you understand it

In IFRS, there is something we refer to as effective interest rate.
You see, it is easy for them to attempt to bamboozle us by saying that interest rate is at 0.7%.
But when you factor in all other management fees, agreement fee (and all what not) as well as non-monetary consideration by the Nigerian government, you would realize that the rate is still at a competitive if not much higher rate.
A transparent government would not try to deceive her people by claiming 0.7% interest rate, rather they would disclose fully all considerations in the loan agreement between Nigeria and ADB, especially if they have nothing to hide.

And if you want to know who is gaining from this whole debacle, then look towards the bankers and the politicians (by default).
Foreign reserve- over $40 billion at what interest rate? Loan from ADB- over $9 billion at "low" interest rates.
The international bankers make money off us while we pay ADB...

Dey keep using debt to GDP ratio as a yardstick without factoring interest rate. A country with a debt to GDP ratio of 85% , and has a borrowing cost of 3% is most likely far better than Nigeria despite our very low debt to GDP ratio.

ochukoccna: We are burrowing to pay back with high interest rates,yet we are creating a sovereign wealth fund to save money
Sounds like penny wise ,pound foolish to me.

Also I doubt the effectiveness of the above quote credited to her
Are interest rates that low for such a maturity date?
Nigeria currently pays between 13-17% on burrowed money used to service her bonds while Spain ,Italy and Portugal are shying away from 6-7%burrowing costs, yet ADB is offering 0.7% interest rates and we still burrow at 13-17%
Yet there are no visible changes in infrastructural development
Is this not the same Ngozi who spoke of SURE-P once upon a time?
Nigerian politics and Economics are so similar, the more you see the less you understand it

If you do not know d difference bw borrowings from bond markets (which is for local debts) AND borrowings from institutional lenders (external debts) in terms of interest rates and maturity, why dont you ask questns Or Shut up.

I wonder how they can balance this up.

taharqa: If you do not know d difference bw borrowings from bond markets (which is for local debts) AND borrowings from institutional lenders (external debts) in terms of interest rates and maturity, why dont you ask questns Or Shut up.

Buffoon, answer the questions he asked; if not, shut up and continue being foolish in the silence of your IQ deficient head.

vascey:

In IFRS, there is something we refer to as effective interest rate.
You see, it is easy for them to attempt to bamboozle us by saying that interest rate is at 0.7%.
But when you factor in all other management fees, agreement fee (and all what not) as well as non-monetary consideration by the Nigerian government, you would realize that the rate is still at a competitive if not much higher rate.
A transparent government would not try to deceive her people by claiming 0.7% interest rate, rather they would disclose fully all considerations in the loan agreement between Nigeria and ADB, especially if they have nothing to hide.

And if you want to know who is gaining from this whole debacle, then look towards the bankers and the politicians (by default).
Foreign reserve- over $40 billion at what interest rate? Loan from ADB- over $9 billion at "low" interest rates.
The international bankers make money off us while we pay ADB...

hmmm....what are you talking about? How much more 'sub-charges' can be added to 0.7% to take it to more than 1-2%? And am at a complete loss at what you were attempting to pass across in respect to the Foreign reserves?..... If you are looking for a potential real problem, look towards Local and not so much Foreign debts

solomonkane:

Buffoon, answer the questions he asked; if not, shut up and continue being foolish in the silence of your IQ deficient head.

Guy i do not hv the time for ignorant loud-mouthd chaps dis morning, lucky you.... But just out of curiousity, what answers did you expect me to give to his 'questns'? If i thought there was any questns that i should in dat comment, wud i advice him to ask questns b4 making assertions? The chap was confusing interest rates from d Bond market (and yes there is a potential real problem here) with Concessionary long-term loans....

This is exactly what the WORLD Bank, IMF, Paris club, London club and other foreign lenders want us to do. The only means by which they can CONTROL us is for us to be INDEBTED to them & who else can do a better job than Madam Ngozi Okonjo Iweala.

Even Beaf {Billyonaire} knows better. I pity my country.

Billyonaire: This is absurd.

is it now? Enjoy the fresh air and stop whining!! Gej all the way! Since u cant move the country forward, then take it back to the stone age!

There's is no harm in that such is life

Point noted

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mekaboy: NIGERIA NEEDS THE MONEY, THERE IS ALOT OF WORK TO.BE DONE. LET THEM.BORROW.

AS LONG AS THE MONEY.WILL.BE.MANAGED PROPERLY.

NGOZI, I WILL HOLD YOU RESPONSINLE IF THIS MONEY IS NOT MANAGED WELL.


HAVING SAID THAT, GO GET THE MONEY AND.PUT IT TO GOOD USE.

IF THE MONEY IS PUT TO GOOD USE, NIGERIA WILL BE MORE PRODUCTIVE AND WE CAN PAY IN LESS THAT 40YRS.

Is this the same loan she's been talking about or another one? Can't Nigeria just manage what they have? then senators and reps will manage a lower pay.

National assembly please stand up against this as you guys did against the initial loan acquisition and gay right movement. ADB is not wealthy that much. Please this eastern imperialist are still at work to ruin Nigeria.