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Buhari Is Pushing Nigeria To New Debt Trap - Punch Editorial - Politics - Nairaland

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Buhari Is Pushing Nigeria To New Debt Trap - Punch Editorial by Omooba77: 9:22am On Nov 16
RENEWED alarm raised by some stakeholders over the country’s headlong plunge into debt demonstrates the precarious state of the economy and the need for an effective remedial strategy. While the Governor of Kaduna State, Nasir el-Rufai, private sector operators and federal legislators separately lamented that Nigeria was close to borrowing beyond its capacity to repay, the Federal Government was ramping up fresh borrowing plans. There should be a limit to borrowing: promoting productive and long-term investment offers a better option for reviving the economy.

The debt conundrum is unnerving. El-Rufai and others gathered at the annual conference of the Chartered Institute of Taxation of Nigeria warned that the country had neared its maximum borrowing capacity. At 18 per cent, compared to a tax-to-GDP of 6.1 per cent, debt-to-GDP ratio is nearing a dangerous level, they warned. Meanwhile, revenue-to-debt, the real marker the International Monetary Fund has told policymakers to watch, reached 99 per cent in the first quarter of this year. News also broke of pushback from some members of the usually pliant House of Representatives to the government’s plan to obtain a new $1.2 billion from Brazil.

Ominously, the Minister of Finance, Budget and National Planning, Zainab Ahmed, said the government would borrow a total of N6.17 trillion in 2021, higher than the initially projected N5.2 trillion deficit (at 3.64 per cent of GDP, it is above the prescribed 3.0 per cent threshold), billed to be funded by debt and privatisation proceeds. Realising the revenue target of N7.88 trillion is shakier, following the destruction wrought by recent riots and the continued ravages of the resurgent COVID-19 pandemic.

No country can escape debt entirely. For emerging economies especially, development agencies recommend a judicious mix of well-structured credit, aid, foreign direct investment, tax revenues, PPP and domestic capital formation to drive development and the transition to middle income and high-income status. UNCTAD said that due to the increasing fragilities of the financial and economic environment since the 2008 global meltdown, developing economies’ debt rose from under 40 per cent of global GDP to 93.2 per cent in 2017 with external debt stock rising by 8.5 per cent annually. With the pandemic and depressed commodity prices, the World Economic Forum reports record level borrowing by both rich and poor countries, saying if well applied, debt can help recovery and cushion the impact. Up to $3.5 billion has already been pledged to Nigeria by the World Bank/IMF pair.

Borrowing perpetually for all projects, however, is unrealistic and unsustainable. The wiser course of action is for the government to target higher revenues by improving tax administration and by massive privatisations; rather than borrowing for all rail, airport and ports projects, it should liberalise and grant concessions. Liberalisation magnetised over $70 billion investment in the ICT sector between 2001 and October 2020, adding 15.09 per cent to GDP by Q2 2020, from 4.1 per cent in 2004.

The regime of the President, Major General Muhammadu (retd.), has been particularly reckless, shattering all previous borrowing records. The Debt Management Office figures show that total public debt stock – federal, states; domestic and external – was N12.35 trillion in September 2015, rose to N16.88 trillion a year later, N20.37 trillion in September 2017, N26.21 trillion by September 2019 and N31 trillion this year. Ahmed projects it to reach N38.6 trillion by December 2021. External debt in September 2015, four months after Buhari assumed office, was just $10.61 billion, but has been growing exponentially; to $15.35 billion in 2017, $26.94 billion in 2019 and $31.47 billion by June 30, 2020. Worse is that beyond claiming to pay public employees’ salaries, Nigerians see little to justify the debt amassed on their behalf.

In contrast, under Public-Private Partnership arrangements, Ethiopia and Djibouti jointly built the 756-kilometre Addis Ababa-Djibouti Rail at a cost of $4.5 billion that provided land-locked Ethiopia access to the sea and carries 95 per cent of its trade. According to the World Bank, Morocco was able to develop first rate infrastructure, including the port of Casablanca, one of the world’s largest artificial ports and 70 airports, 11 of which are globally rated, by utilising aid, loans, improving its tax system, attracting FDI and facilitating domestic entrepreneurship.

No country can use borrowing alone to reverse poverty and joblessness; the government should transparently embark on asset sales to free its funds, allow capable private operators to run them and create jobs; improve the operating environment to attract FDI, block revenue leakages and collect all its due revenues from income-generating MDAs.

Urgently, it must reform the tax system, targeting at least 15 per cent tax-to-GDP ratio; the current level of 6.1 per cent falls embarrassingly far short of the African average of 16.5 per cent, Latin and Caribbean average of 23.1 per cent and OECD’s 34.3 per cent. The National Assembly should be more rigorous in its oversight duty and stop rubber-stamping Buhari’s requests for approvals to borrow. All stakeholders should join the few NGOs that have been demanding accountability through FoI requests and lawsuits over the loans. Such demand for accountability and monitoring are strongly recommended by the World Bank and UNCTAD as part of the necessary public buy-in deemed essential in a vibrant democracy. After exiting a 30-year debt trap in 2005/06, Buhari should halt the headlong plunge into another.

https://punchng.com/buhari-is-pushing-nigeria-to-new-debt-trap/?

19 Likes 2 Shares

Re: Buhari Is Pushing Nigeria To New Debt Trap - Punch Editorial by Omooba77: 9:49am On Nov 16
Debt will not kill us, the irony is that most of those signing these debts/loans agreement are over 65 years, that at maturity they will be 6ft below.

93 Likes 6 Shares

Re: Buhari Is Pushing Nigeria To New Debt Trap - Punch Editorial by IME1: 9:51am On Nov 16
angry
All these awareness from different places, are the people in authority listening and learning and avoiding future problems?

17 Likes 1 Share

Re: Buhari Is Pushing Nigeria To New Debt Trap - Punch Editorial by Nigeriabiafra80: 9:51am On Nov 16
I can remember when we were called all sort of names Because we refuse to support buhari
Some said that is because their son is the VP today they want us to exonerate their son from the atrocities of this current government
Waooo
If you have never travel out of Nigeria,you won’t know that you are suffering rather in a big cage called Nigeria
Dollar at the rate of 470 against 380
Rice in the south is costlier
Borders in the south is close and opened for Dangote ,when the wailing was much they included bua
They smuggle rice from out northern borders
There by giving them upper hand to transport rice down south
Just as they did to dollar business
Dangote still get dollar in subsidy rate paid by poor Nigerians

161 Likes 11 Shares

Re: Buhari Is Pushing Nigeria To New Debt Trap - Punch Editorial by Ayt27(m): 9:51am On Nov 16
And the Chinese are eagerly setting the Trap.

If I was owning you money and I keep coming back to borrow money from you and you always continue giving me, if my senses were functional I should be wary of you.

Especially when you have a history exploitation of people's resources on their farms.


Who is it that gives with the right hand and takes with the left hand again?

44 Likes 2 Shares

Re: Buhari Is Pushing Nigeria To New Debt Trap - Punch Editorial by tyson98: 9:51am On Nov 16
That man is a disaster !

32 Likes 3 Shares

Re: Buhari Is Pushing Nigeria To New Debt Trap - Punch Editorial by Macsjebs(m): 9:51am On Nov 16
shocked Na wa, May God heal our Economy

I got more than I bargained for at the wedding of a nairalander - it was indeed love at first smell. I was no where near the best dressed or most good looking, but my scent stole the show

For guys here still thinking, spending or ________ is the only way to get a lady, well, have u tried scenting heavenly. Kindly see reviews on the thread on my signature
Re: Buhari Is Pushing Nigeria To New Debt Trap - Punch Editorial by Judah95(m): 9:51am On Nov 16
It's just the beginning.

Nigeria has been technically sold out to foreigners

11 Likes 3 Shares

Re: Buhari Is Pushing Nigeria To New Debt Trap - Punch Editorial by HenryThegreat1(m): 9:51am On Nov 16
PDP unable to pay her staff salary is more concern to APC.

8 Likes 1 Share

Re: Buhari Is Pushing Nigeria To New Debt Trap - Punch Editorial by Kenplay(m): 9:51am On Nov 16
Is this the same government Yorubas abuse igbos for not voting for?
Sophisticated people indeed

92 Likes 8 Shares

Re: Buhari Is Pushing Nigeria To New Debt Trap - Punch Editorial by vickydankal(f): 9:51am On Nov 16
Before 2023 Buhari May ask China to colonialise us with abeg or better still tell them to take over from him so that they will take their money from IGR.

3 Likes 1 Share

Re: Buhari Is Pushing Nigeria To New Debt Trap - Punch Editorial by Godada: 9:52am On Nov 16
In hoping for a solution, Nigeria got herself into a bigger problem

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Re: Buhari Is Pushing Nigeria To New Debt Trap - Punch Editorial by Rugaria: 9:52am On Nov 16
I think it's intentional. I mean it's getting obvious! The plan seem to be to borrow as much money as possible to do all infastructural works in the north and when the next regime steps in, they will spend all their tme and energy trying to repay those loans.... Then another buharist will take over and start borrowing again. Obasanjo paid off the loans acquired by the Babangidas and the Abachas, then this....There is nobody that can claim to love this country that will hobble her down with this level of borrowing, especially when a huge percentage of those loans were used to do infastructural projects that benefits folks in Niger republic more than folks in nigeria.

85 Likes 3 Shares

Re: Buhari Is Pushing Nigeria To New Debt Trap - Punch Editorial by MsAllison(f): 9:52am On Nov 16
tge
is criminal terrorist buhari is the worst thing that has ever happened to the world

3 Likes 1 Share

Re: Buhari Is Pushing Nigeria To New Debt Trap - Punch Editorial by Muhylonaire007: 9:52am On Nov 16
By the time this administration is over, you will pity the next administration, pity Nigerians and pity Nigeria sef.


We are in a mess already

19 Likes 1 Share

Re: Buhari Is Pushing Nigeria To New Debt Trap - Punch Editorial by HeadShot: 9:52am On Nov 16
undecided undecided

Buhari destiny is to impoverish Nigerians and plunge the country to debt...

While Yoruba Muslims cheer him on..

41 Likes 2 Shares

Re: Buhari Is Pushing Nigeria To New Debt Trap - Punch Editorial by MrCover: 9:52am On Nov 16
That's The Truth

2 Likes

Re: Buhari Is Pushing Nigeria To New Debt Trap - Punch Editorial by thundafire: 9:53am On Nov 16
Deadmeat should come and blame 16years of waste,and should not be compared to 5 years oh,by the time Buhari is through with the country,we go know how far

9 Likes 1 Share

Re: Buhari Is Pushing Nigeria To New Debt Trap - Punch Editorial by kayusely70(m): 9:53am On Nov 16
We Have Fallen Into Another Debt Trap

1 Like 1 Share

Re: Buhari Is Pushing Nigeria To New Debt Trap - Punch Editorial by DennisEche(m): 9:53am On Nov 16
SO MANY TIMES I HAVE CALLED MY SELF TO REASON WHY BUHARI SO MUCH HATE NIGERIANS, IS HE PUNSIHING US FOR THE MANY TIMES HE TRIED TO BE PRESIDENT AND WAS REFUSED. PLS BABA BUHARI PLS FORGIVE US, THIS IS TOO MUCH. BEDT, INCREASE IN FUEL, ELECTRICITY HIKE,HIGH UNEMPLOYMENT,INSECURITYK,HUNGER. HABA BABA.

7 Likes 1 Share

Re: Buhari Is Pushing Nigeria To New Debt Trap - Punch Editorial by Dexpro: 9:53am On Nov 16
Rugaria:
I think it's intentional. I mean it's getting obvious! The plan seem to borrow as much money as possible to do all infastructural works in the north and when the next regime steps in, they will spend all their tme and energy trying to repay those loans.... Then another buharist will take over and start borrowing again. Obasanjo paid off the loans acquired by the Babangidas and the Abachas, then this....There is nobody that can claim to love this country that will hobble her down with this level of borrowing, especially when a huge percentage of those loans were used to do infastructural projects that benefits folks in Niger republic more than folks in nigeria.

You said it all. It's obviously intentional. We are in for a long and tortious suffering

angry

24 Likes 1 Share

Re: Buhari Is Pushing Nigeria To New Debt Trap - Punch Editorial by Officialhorlah(m): 9:53am On Nov 16
Slavery Debt trap
Na him people go be slave
Covik - 19 Man grin

8 Likes 1 Share

Re: Buhari Is Pushing Nigeria To New Debt Trap - Punch Editorial by ablejesus26: 9:54am On Nov 16
ok

e be scary tins oo

i have never really fancied relocating from my own fathers land my own Country to another mans Land

guy money dey dis Country i swear we have a very fertile ground for financial gigantism so why look for it in another mans land

but with the way diz matter dey go i go begin consider am bcus e be like sey dis Demonic govt don sell Us to The highest bidder

How did we get here how how why

6 Likes 1 Share

Re: Buhari Is Pushing Nigeria To New Debt Trap - Punch Editorial by NaijaMutant(f): 9:54am On Nov 16
There's nothing to worry here since only ipobs and wailers will pay the debt.


Our darling daddy should fire on cool



Life of a zombie.

8 Likes

Re: Buhari Is Pushing Nigeria To New Debt Trap - Punch Editorial by IamPlato(m): 9:54am On Nov 16
There is a group of ret@rded idiots that keep mentioning names of nairalanders who they claim are shameless and from the north, on this list is my name...

This is how animals in human form keep spreading false information about people they do not know have never met all because you tried to tell them the bitter truth...

They have no other plan that to spoil the imagine and name of people with a better intelligence than they have...


The last thing one would do is argue with these pigs, some of them just copy our names into a list and shared it without minding to verify the information before passing... This is how you guys brought violence on Nigeria with false information during end SARS protest


Some of these animals include


DasaintHope gimakon, especially this idiot called Kirchoffs


You better stop spamming nairaland or else you might regret your tomorrow... Be warned!

3 Likes 2 Shares

Re: Buhari Is Pushing Nigeria To New Debt Trap - Punch Editorial by Princedapace(m): 9:54am On Nov 16
lol, Buhari doesnt know a shit about economy and he surrounded him self with people like him self all in the name of tribalism. The worse part of it is that southerners will pay more of the TAX used to service these loans.

I dislike the political structure of Nigeria.

21 Likes 1 Share

Re: Buhari Is Pushing Nigeria To New Debt Trap - Punch Editorial by Nbotee(m): 9:54am On Nov 16
Why won't he wen una carry Barrow pusher say make e com drive plane... Trap wey don catch us and we don lie down comfortably inside with blanket

7 Likes 1 Share

Re: Buhari Is Pushing Nigeria To New Debt Trap - Punch Editorial by chatinent(m): 9:54am On Nov 16
cry
Re: Buhari Is Pushing Nigeria To New Debt Trap - Punch Editorial by MisterGrace: 9:54am On Nov 16
I think Nigeria is already in the debt trap.

5 Likes

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