Nigeria's debt profile on all time high

Nigeria's total debt portfolio may have hit an all-time high of N4.875 trillion ($32.5 billion), Ehigie Uzamere, chairman senate committee on local and foreign debts has said.

Mr Uzamere disclosed this at the opening of the public hearing on the Debt Management Office (DMO) re-enactment bill held yesterday in Abuja.

According to Mr Uzamere, this includes local debt and foreign debts the Nigerian government is obligated to.

"Presently, our external debt stands at $4.5 billion; Domestic debt is valued at over $28 billion and is rising. National and sub-national governments are going to the capital market to borrow for development projects and finance budget deficits," Mr Uzamere said.

He however said the total debt portfolio as calculated excludes and other securities the government, including states and local governments acquired over the past three years.

"There's no statistics on other implied debts from Public Private Partnership (PPP), government guarantees and bail out to banks, textile firms, etc. not to mention the arrears of contractual obligations by government. The list is endless," he noted.

The senate president, David mark, also condemned the rampant, public private partnerships and internal and external borrowing by all levels of government.

"One of the sources of public debt is public private partnership," the senate president said. "They look attractive on the surface but if faced with challenges it becomes a debt on government.

While we need the private sector to fast track infrastructural development, government must be ready to carefully scrutinise terms and conditions of every partnership to avoid pitfalls which can impact negatively on the economy and Nigerians."

According Mr Uzamere, the speedily growing debt profile is due to a lack of central regulation of government borrowing in Nigeria, hence the bill.

When the bill is passed into law, it will require DMO to issue guidelines on both external and domestic borrowing, federal government guarantees and on-lending to sub nationals subject to the approval of Federal Executive Council.

The office will also be required to develop a debt market for the state governments to allow them have direct access to borrowing through issuance of state bonds.

The bill is expected to plug the loopholes on borrowing exploited by states and local governments by making it mandatory for those governments to obtain finance minister's consent before they get loans.

"The National Assembly will not condone frivolous borrowings or misapplication of funds meant for development projects," the senate president warned.

http://234next.com/csp/cms/sites/Next/News/Metro/Politics/5640022-146/nigerias_debt_profile_on_all_time.csp

Tip of the iceberg.

now i want Nigeria to go war with Iran we have enough to back it up

We can shout and blame OBJ all we want but the fact remains. He did a better job of managing the national debt under his belt.

@Sulad82i, you aint never lied. I totally agree with you. I personally think that he is the best president that we have ever had in nigeria. At least I can use mobile phone. He is still a bush me, with his statement such as " I dey Kampe". lol

Congratulations to Nigeria. Just N4.875 trillion ($32.5 billion) debt?
What of the foreign reserve disapperaing and going down day by day?

why am i not suprised

what are we spending the money on? private jets?

sulad82i:

We can shout and blame OBJ all we want but the fact remains. He did a better job of managing the national debt under his belt.

jason2010:

@Sulad82i, you aint never lied. I totally agree with you. I personally think that he is the best president that we have ever had in nigeria. At least I can use mobile phone. He is still a bush me, with his statement such as " I dey Kampe". lol

yeah, i also think obj is the best president nigeria has ever had which is unfortunate!

jason12345:

what are we spending the money on? private jets?

yeah, i also think obj is the best president nigeria has ever had which is unfortunate!

you are right bro. . . .can you imagine obj being the best president we ever had? can you imagine one of the worst humans on earth being the best we ever had? You have to visualize the cesspool he must have come from in a long list of politicians,

I don't know how OBJ is the best president Nigeria has ever had, OBJ's ill-prepared successors and apostles of his "do or die" brand of politics, who are our present economic managers, were handpicked by the OBJ and forced on us through the dubious and thoroughly discredited 2007 elections. OBJ cannot be absolved from our high debt profile and disappearing foreign reserves.

people are u sure jonathan is going to do a good job

obj removed the debt, between 2007 tp 2010 of yaradua and jonathan we are in serious debt again

people think of what jonathan has doing for 1 year before u vote

Otunba-1:

I don't know how OBJ is the best president Nigeria has ever had, OBJ's ill-prepared successors and apostles of his "do or die" brand of politics, who are our present economic managers, were handpicked by the OBJ and forced on us through the dubious and thoroughly discredited 2007 elections. OBJ cannot be absolved from our high debt profile and disappearing foreign reserves.

That is another way to look at it.

alj harem:


obj removed the debt, between 2007 tp 2010 of yaradua and jonathan we are in serious debt again

OBJ didn't do anything. Dr. Ngozi Okonjo-Iweala was the person who removed our debt. Without her, our debt would have  actually increased.

EzeUche0:

OBJ didn't do anything. Dr. Ngozi Okonjo-Iweala was the person who removed our debt. Without her, our debt would have  actually increased.

You have started chatting nonsense again. Do you care to tell us how she did it? Under OBJ's stewardship, Nigeria had part of its debt forgiven by the Paris club while guarantees were made by the government to repay what was outstanding. Can the finance minister or treasury secretary (in the US) act without the president's authority?

Katsumoto:

You have started chatting nonsense again. Do you care to tell us how she did it? Under OBJ's stewardship, Nigeria had part of its debt forgiven by the Paris club while guarantees were made by the government to repay what was outstanding. Can the finance minister or treasury secretary (in the US) act without the president's authority?

If it wasn't for her influence and background, those things that you explained would not have happened. Don't you understand. Having such a qualified finance minister who is known in the world of finance is a net plus for us. She was the former Vice-president and corporate secretary of the World Bank for goodness sake.

EzeUche0:

If it wasn't for her influence and background, those things that you explained would not have happened. Don't you understand. Having such a qualified finance minister who is known in the world of finance is a net plus for us. She was the former Vice-president and corporate secretary of the World Bank for goodness sake.

I suppose the president of the World Bank, Robert Zoellick, can get America's creditors to forgive America's debt; also, Dominic Strauss-Kahn can use his position as president of the IMF to get French creditors to forgive its debt.

EzeUche0:

If it wasn't for her influence and background, those things that you explained would not have happened. Don't you understand. Having such a qualified finance minister who is known in the world of finance is a net plus for us. She was the former Vice-president and corporate secretary of the World Bank for goodness sake.

you really need to stop looking at things ethnically

jason12345:

you really need to stop looking at things ethnically

Who said I was looking at it through an ethnic standpoint? I looking through an economic standpoint. It was just a matter of fact that it was an Igbo woman who helped get our debt forgiven. That is it.

Katsumoto:

I suppose the president of the World Bank, Robert Zoellick, can get America's creditors to forgive America's debt; also, Dominic Strauss-Kahn can use his position as president of the IMF to get French creditors to forgive its debt.

You are comparing apples with oranges. Neither of these gentlemen that you have mentioned come from developing nations do they? She used her contacts and expertise in the field to help get our debt forgiven. Anyone who denies this must crucial fact is a fool.

You need to understand the structure of these debts. out of the $32.5b, only $4.5billion is foreign while over $25billion is local. OBJ never cleared the local debts. He only fixed the foreign debts. Thats not to say that he did not do well. he left us a very healthy reserve.
The cabal under Yardua messed up the debt profile, not Johnathan.

i sincerely hope that he has the acumen to cap the debts and stop further build up, otherwise, all the gains we made under OBJ would have been eroded.

EzeUche0:

You are comparing apples with oranges. Neither of these gentlemen that you have mentioned come from developing nations do they? She used her contacts and expertise in the field to help get our debt forgiven. Anyone who denies this must crucial fact is a fool.

Is it only developing nations that have debts or is it only developing nations that have executives on the boards of the IMF and the World Bank that have their debts forgiven? Nigeria's debts were forgiven at a time when campaigners such as Bono, Sean Penn, and others lobbied developed nations to forgive third world debt. Did all third world countries, that had part or all of their debt, have executives on the board of the IMF or World Bank?

Nigeria was able to have its debt completely written off because it had increased its foreign reserves due to the high price of oil and OBJ's management style. If the head did not save the money, Nigeria would not have paid off completely the remainder of the debt. Every debate must not start and end on an ethnic tone.

You guys are at it again, @katsumoto, just like EzeUche explained you are comparing apples to oranges; if Dr Zoellich of the WBG left his position to take over Tm Geithners position as treasury secretary, then there's a possibility that may happen. It certainly would not happen while he's at WBG. Besides U.S. national debt is a mixture of foreign debt.

Katsumoto:

Is it only developing nations that have debts or is it only developing nations that have executives on the boards of the IMF and the World Bank that have their debts forgiven? Nigeria's debts were forgiven at a time when campaigners such as Bono, Sean Penn, and others lobbied developed nations to forgive third world debt. Did all third world countries, that had part or all of their debt, have executives on the board of the IMF or World Bank?

Nigeria was able to have its debt completely written off because it had increased its foreign reserves due to the high price of oil and OBJ's management style. If the head did not save the money, Nigeria would not have paid off completely the remainder of the debt. Every debate must not start and end on an ethnic tone.

I respect you as an intellect, there is no denying that, but I have to disagree with you. No, it isn't only developing nations that have debt. Look at how much the US is owing China, but the fact in the matter is, the World Bank and IMF is controlled by Western nations. Since, they contribute the most money to these international institutions, they have a lot of power within these organizations.

Remember, that many developing countries had some of their debt forgiven, but they still owed a lot of money to these institutions. Under the stewardship of Dr. Ngozi Okonjo-Iweala who knew the inner workings of the World Bank, she was able to help Nigeria in ways, other developing nations did not have connections. I can get on another discussion about the World Bank in how these debts are unjust, but that is up for another discussion.

I see you like to leave Dr. Okonjo-Iweala contribution to lowering our debt. That is my problem. OBJ had nothing to do with it. He just had talented people on his staff. And I will not give him any credit. All credit goes to those who are in the trenches, not the supervisor. You understand where I am coming from? My statement has no ethnic undertone. I would have said the same thing if the finance minister was Yoruba or Hausa.

EzeUche0:

I respect you as an intellect, there is no denying that, but I have to disagree with you. No, it isn't only developing nations that have debt. Look at how much the US is owing China, but the fact in the matter is, the World Bank and IMF is controlled by Western nations. Since, they contribute the most money to these international institutions, they have a lot of power within these organizations.

Remember, that many developing countries had some of their debt forgiven, but they still owed a lot of money to these institutions. Under the stewardship of Dr. Ngozi Okonjo-Iweala who knew the inner workings of the World Bank, she was able to help Nigeria in ways, other developing nations did not have connections. I can get on another discussion about the World Bank in how these debts are unjust, but that is up for another discussion.

I see you like to leave Dr. Okonjo-Iweala contribution to lowering our debt. That is my problem. OBJ had nothing to do with it. He just had talented people on his staff. And I will not give him any credit. All credit goes to those who are in the trenches, not the supervisor. You understand where I am coming from? My statement has no ethnic undertone. I would have said the same thing if the finance minister was Yoruba or Hausa.

If Nigeria's debt had ballooned to £4 trillion, would you have blamed Okonjo-Iweala? BTW, I believe she is a talented finance professional. One of the aspects of leadership is competent delegation. OBJ got it right when it came to ministers but he got it wrong when it came to governors for obvious reasons. Also I alluded to the fact that it is not only developing nations that have debts.

manny4life:

You guys are at it again, @katsumoto, just like EzeUche explained you are comparing apples to oranges; if Dr Zoellich of the WBG left his position to take over Tm Geithners position as treasury secretary, then there's a possibility that may happen. It certainly would not happen while he's at WBG. Besides U.S. national debt is a mixture of foreign debt.

I asked a simple question, did all countries that had their debt forgiven, either partly or wholly, have a finance minister who previously worked for the WB/IMF?

Also, most countries have a mixture of internal and external debt, unless you are China.

Katsumoto:

If Nigeria's debt had ballooned to £4 trillion, would you have blamed Okonjo-Iweala?

It depends who was responsible for the ballooning debt. Knowing Nigerian politicians, it is hard for them to follow their financial advisors, so if she spoke out against the reckless spending, then I would not blame her. However, if she didn't, I would blame her as well.

Katsumoto:

Iasked a simple question, did all countries that had their debt forgiven, either partly or wholly, have a finance minister who previously worked for the WB/IMF?

Also, most countries have a mixture of internal and external debt, unless you are China.

I wouldn't know but Mrs Iweala shows as an example and I'm certain that looking at the history and bios of most of them, there must be a connection. Unless China, meaning? That they don't have debt or, how do u mean?

Bottom line is Paris Club forgave the debt, there is no lobbying if you don't have a presence nor influence.

manny4life:

I wouldn't know but Mrs Iweala shows as an example and I'm certain that looking at the history and bios of most of them, there must be a connection. Unless China, meaning? That they don't have debt or, how do u mean?

It is ludicrous to allude that most developing nations that had their debt written off at the same time had finance ministers who previously worked for the IMF/WB. I will try to find an article from the Economist from a few years ago where the credit was given to campaigners who lobbied for third world debt to be written off.

Katsumoto:

It is ludicrous to allude that most developed nations that had their debt written off at the same time had finance ministers who previously worked for the IMF/WB. I will try to find an article from the Economist from a few years ago where the credit was given to campaigners who lobbied for third world debt to be written off.

You do know that most developed nations do not go to the World Bank or IMF for funding?  I have never heard of the U.S. or the European nations after the post-war rebuilding of the Western European powers that have went to the World Bank for loans.

Even tiny Greece did not go to the World Bank for the loan, but the European Union.

EzeUche0:

You do know that most developed nations do not go to the World Bank or IMF for funding?  I have never heard of the U.S. or the European nations after the post-war rebuilding of the Western European powers that have went to the World Bank for loans.

Even tiny Greece did not go to the World Bank for the loan, but the European Union.

Greece went to the IMF and the EU. The UK went to the IMF in 1975. Russia, although a member of the G8, still has debts with the IMF. There are many developed nations that have gone to the IMF. If Greece, Ireland, and Portugal default on their soverign debt, as predicted by most analysts, they would all go to the IMF.

I actually meant developing nations; I will correct it. Generally, most nations go to the IMF if they are unable to either service their soverign debt or if they are unable to borrow from the capital markets.

Look, here's a simple question

How many "Third World Countries has had their debt written off from 2006 - 2008 even till current? Answer that question, and we can take it from there. Forgiveness of debt is reviewed on case-by-case basis, Nigeria was no exception. Nigeria lobbied, met all criterion's for her debt to be written and it was. It did not happen under one day nor 30 days nor 180days, it was a work-n-process that finally paid off in 2006 which was originally engineered by someone.