The president of the African Development Bank, Akinwumi Adesina has expressed the bank’s worry over Nigeria’s debt to revenue ratio.

Adesina, speaking at the opening of the two-day Mid-term Ministerial Performance Review Retreat at the Presidential Villa on Monday in Abuja said dmi espite Nigeria’s debt to the GDP remaining moderate at 35 per cent, the government must take decisive action to tackle its debt challenges for the economy to grow.

He said, “Nigeria must decisively tackle its debt challenges. The issue is not about the debt-to-GDP ratio, as Nigeria’s debt-to-GDP ratio at 35% is still moderate. The big issue is how to service the debt and what that means for resources for domestic investments needed to spur faster economic growth.

“The debt service to revenue ratio of Nigeria is high at 73%. Things will improve as oil prices recover, but the situation has revealed the vulnerability of Nigeria’s economy. To have an economic resurgence, we need to fix the structure of the economy and address some fundamentals.”


According to the Debt Management Office, Nigeria’s total public debt, which includes the federal and state governments, had climbed to N35.46 trillion at the end of the second quarter of 2021.

Akinwumi noted that while Nigeria faces the challenge of revenue concentration due to a mainly one-sided source, he stated that structural bottlenecks that limit the country’s productivity need to be removed for other sectors to generate revenue.

“Nigeria’s challenge is revenue concentration, as the oil sector accounts for 75.4 % of export revenue and 50 % of all government revenue.

“What is needed for sustained growth and economic resurgence is to remove the structural bottlenecks that limit the productivity and the revenue earning potential of the huge non-oil sectors.”

Omooba77:
The president of the African Development Bank, Akinwumi Adesina has expressed the bank’s worry over Nigeria’s debt to revenue ratio.

Adesina, speaking at the opening of the two-day Mid-term Ministerial Performance Review Retreat at the Presidential Villa on Monday in Abuja said despite Nigeria’s debt to the GDP remaining moderate at 35 per cent, the government must take decisive action to tackle its debt challenges for the economy to grow.

He said, “Nigeria must decisively tackle its debt challenges. The issue is not about the debt-to-GDP ratio, as Nigeria’s debt-to-GDP ratio at 35% is still moderate. The big issue is how to service the debt and what that means for resources for domestic investments needed to spur faster economic growth.

“The debt service to revenue ratio of Nigeria is high at 73%. Things will improve as oil prices recover, but the situation has revealed the vulnerability of Nigeria’s economy. To have an economic resurgence, we need to fix the structure of the economy and address some fundamentals.”


According to the Debt Management Office, Nigeria’s total public debt, which includes the federal and state governments, had climbed to N35.46 trillion at the end of the second quarter of 2021.

Akinwumi noted that while Nigeria faces the challenge of revenue concentration due to a mainly one-sided source, he stated that structural bottlenecks that limit the country’s productivity need to be removed for other sectors to generate revenue.

“Nigeria’s challenge is revenue concentration, as the oil sector accounts for 75.4 % of export revenue and 50 % of all government revenue.

“What is needed for sustained growth and economic resurgence is to remove the structural bottlenecks that limit the productivity and the revenue earning potential of the huge non-oil sectors.”


https://punchng.com/nigeria-must-tackle-73-debt-service-to-revenue-ratio-for-economy-to-grow-says-afdb-president-adesina/

ChimaAdeoye:


Where are those people asking for more borrowing arguing that our Debt - GDP ratio was lower than America's and Japan's. While failing to mention that Japan and America were highly productive nations that did not depend on the price of crude oil and their diaspora remittances to get foreign exchange.

Those deceitful people are now silent after they misled this country into another debt trap.

The sad truth is that the debt servicing bill will continue to rise from 73% to surpass 100% of revenue in a very short period. As we continue the mindless borrowing policy based on the dubious GDP - Debt ratio.

Enceladus:
APC jobbers will say the government is building infrastructures. But at what cost? Most of our revenue is spent on servicing debts. Obasanjo wasted his time clearing Nigeria's debt.

Mftivi:
oga you no understand the post you dey give opinion, which management ? Your debt service to revenue ratio is at 73% and you are talking about management, management of what ? The sad thing is that the borrowed funds were not deployed mostly into performing assets or sectors so our oil revenue bears most of the burden of repaying that loan and we are already at 73 fvcking percent.

PHIPEX:
Part of management is borrowing what you can pay. Imagine using 73% of your monthly salary to pay debt? Yet you keep borrowing for next budget. Those hanging on debt to GDP argument are killing us, very soon the govt will use 100% of it's monthly income to pay gbese. They are laying time bomb for the next govt similar to Osun state.

ChimaAdeoye:


Where are those people asking for more borrowing arguing that our Debt - GDP ratio was lower than America's and Japan's. While failing to mention that Japan and America were highly productive nations that did not depend on the price of crude oil and their diaspora remittances to get foreign exchange.

Those deceitful people are now silent after they misled this country into another debt trap.

The sad truth is that the debt servicing bill will continue to rise from 73% to surpass 100% of revenue in a very short period. As we continue the mindless borrowing policy based on the dubious GDP - Debt ratio.

Ajoself:
If you listened to Dr Adesina's speech today, you would conclude he wasn't nurtured here. He's very sound. Not our northerners that are using power to their advantage. My advice to people is that one should don't rely on the Buhari-led administration at all. I am a victim of it. I applied for dssc 28, I was shortlisted to come for training in Port Harcourt. They later dropped me after lying with my medical result. Northerners that did not even participated in the screening exercise from day one were not dropped

Havertz10:
he said nothing