Nigeria’s borrowing space keeps reducing due to the inability to service debt.
During the induction of newly-elected lawmakers of the 10th national assembly in Abuja.
I said the ratio of the country’s budget to its gross domestic product (GDP), unlike other countries, is less than its needs.
While the size of the federal government budget for 2023 created some excitement, the aggregate budgets of all governments in the country amount to about N30 trillion. That is less than 15 percent in terms of ratio to GDP. Even on the African continent, the ratio of spending is about 20 percent. South Africa is about 30 percent, Morocco is about 40 percent and at 15 percent, that is too small for our needs.
That is why there is fierce competition for the limited resources. That can determine how much we can relatively borrow. We now have very limited borrowing space, not because our debt to GDP is high, but because our revenue is too small to sustain the size of our debt. That explains our high debt service ratio.
Once a country’s debt service ratio exceeds 30 percent, that country is in trouble and we are pushing towards 100 percent and that tells you how much trouble we are in. We have limited space to borrow.
When you take how much you can generate in terms of revenue and what you can reasonably borrow, that establishes the size of the budget. The next thing would be to pay attention to government priority regarding what project gets what.
The budget is not a shopping list. In the end, the budget only contained expenditure.
Earlier this year, Zainab Ahmed, the minister of finance, budget and national planning, said the overall deficit for the 2023 budget is N11.34 trillion, representing 5.03 percent of the country’s gross domestic product (GDP).
Ahmed said the budget deficit would be financed mainly by borrowings; noting that N7.04 trillion would be sourced from domestic sources, N1.76 trillion from foreign sources, and N1.77 billion from multilateral and bilateral loan drawdowns, while privatisation proceeds would provide N206.18 billion.
As of December 2022, Nigeria’s total public debt had hit N46.25 trillion.
Recently, the senate retroactively approved a N22.7 trillion loan that had been spent by the executive arm of the government.
On Wednesday, President Muhammadu Buhari wrote to the senate for approval to borrow $800m from the World Bank.

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Nlpfmod

post=123113425:
Nigeria’s borrowing space keeps reducing due to the inability to service debt.
During the induction of newly-elected lawmakers of the 10th national assembly in Abuja.
I said the ratio of the country’s budget to its gross domestic product (GDP), unlike other countries, is less than its needs.
While the size of the federal government budget for 2023 created some excitement, the aggregate budgets of all governments in the country amount to about N30 trillion. That is less than 15 percent in terms of ratio to GDP. Even on the African continent, the ratio of spending is about 20 percent. South Africa is about 30 percent, Morocco is about 40 percent and at 15 percent, that is too small for our needs.
That is why there is fierce competition for the limited resources. That can determine how much we can relatively borrow. We now have very limited borrowing space, not because our debt to GDP is high, but because our revenue is too small to sustain the size of our debt. That explains our high debt service ratio.
Once a country’s debt service ratio exceeds 30 percent, that country is in trouble and we are pushing towards 100 percent and that tells you how much trouble we are in. We have limited space to borrow.
When you take how much you can generate in terms of revenue and what you can reasonably borrow, that establishes the size of the budget. The next thing would be to pay attention to government priority regarding what project gets what.
The budget is not a shopping list. In the end, the budget only contained expenditure.
Earlier this year, Zainab Ahmed, the minister of finance, budget and national planning, said the overall deficit for the 2023 budget is N11.34 trillion, representing 5.03 percent of the country’s gross domestic product (GDP).
Ahmed said the budget deficit would be financed mainly by borrowings; noting that N7.04 trillion would be sourced from domestic sources, N1.76 trillion from foreign sources, and N1.77 billion from multilateral and bilateral loan drawdowns, while privatisation proceeds would provide N206.18 billion.
As of December 2022, Nigeria’s total public debt had hit N46.25 trillion.
Recently, the senate retroactively approved a N22.7 trillion loan that had been spent by the executive arm of the government.
On Wednesday, President Muhammadu Buhari wrote to the senate for approval to borrow $800m from the World Bank.

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Nlpfmod

There’s no trouble. Tinubu will correct all the economic mistakes of Buhari and set Nigeria on path of growth. Just over 2 weeks remaining.

Those poor church 🐀 🐁 🐭 🐀 that keep defending these criminals over borrowing will face the music soon

Soon it will be bankrupt

Emilokan to the rescue

I once posted in this forum that the cost of keeping Nigeria as a united country was fast outpacing the benefit of its existence or the total revenue it was making from all its revenue channels.

Nigeria is fast getting into a revenue stagnation stage , a stage where the country will suffer asphyxiation because of the enormous size of its population , economic liability and its poor financial situation as against the little or poor revenue from niger delta oil which will make it choke on its own weight

lastcall:
Emilokan to the rescue

Does he have the mental capacity to rescue Nigeria?

More Igbos business men and women will buy more land and houses in Lagos from Lagos landlords

drlateef:





There’s no trouble. Tinubu will correct all the economic mistakes of Buhari and set Nigeria on path of growth. Just over 2 weeks remaining.

I pity you, you are done defending Buhari because his tenure is over na Tinubu now, when he was active as a governor he never reduce Lagos debt, today Lagos most indebted state, and all the states control by his men are seriously in debt, Tinubu can't give what he doesn't have, when his home state Osun was having economic turmoil, he did nothing only to remind them he is richer than the state, I pity you guys defending evil

PrinceOfLagos:
More Igbos business men and women will buy more land and houses in Lagos from Lagos landlords

And many more of those people that like to confuse dangerous stupidity for sophistication will gladly sell for cheap just to spray it all on an Iya BUSHuRAT smelly cuntus somewhere, then turn around and manifest that same dangerous stupidity they like to believe is sophistication. A virtual cycle I tell you 🙄

I hear

RealityBender:

And many more of those people that like to confuse dangerous stupidity for sophistication will gladly sell for cheap just to spray it all on an Iya BUSHuRAT smelly cuntus somewhere, then turn around and manifest that same dangerous stupidity they like to believe is sophistication. A virtual cycle I tell you 🙄

And after selling mad spraying large chunk of the money on Iya basirat big ikebe at Owambe party, the pack there bags and head back to there original state of origin of Osun and Ogun states

Mind you Ben Akabueze was two times commissioner of Lagos on finance now he is incharge of budget and planning under Buhari, with the current state of the nation the incoming administration will be handicap, we are currently using almost 100% of our earning to service debt, that's is why the keep borrowing to augment recurrent expenditure, removing the subsidy with current Nigeria situation will be suicide to Nigerians

PrinceOfLagos:

And after selling mad spraying large chunk of the money on Iya basirat big ikebe at Owambe party, the pack there bags and head back to there original state of origin of Osun and Ogun states

The ones that are too ashamed to go back to their states will relocate under Oshodi bridge constituting nuisance and claiming Lagos🙄
The ones that finished primary schl amongst them will be giving itel phones to post on Nairaland🤔

kettykings:
I once posted in this forum that the cost of keeping Nigeria as a united country was fast outreaching the benefit of its existence or the total revenue it was making from all its revenue channels.

Nigeria is fast getting into a revenue stagnation stage , a stage where the country will suffer asphyxiation because of its enormous size and its poor financial situation and will choke on its own weight

In your imagination.

RealityBender:

The ones that are too ashamed to go back to their states will relocate under Oshodi bridge constituting nuisance and claiming Lagos🙄
The ones that finished primary schl amongst them will be giving itel phones to post on Nairaland🤔

Let's just say that most of the so called owners of Lagos live under the bridge

PrinceOfLagos:

Let's just say that most of the so called owners of Lagos live under the bridge

The problem now is where will these so called owners of Lagos go when they eventually sell the bridge??!🙄

drlateef:





There’s no trouble. Tinubu will correct all the economic mistakes of Buhari and set Nigeria on path of growth. Just over 2 weeks remaining.

Many refineries are coming on board. Once fuel subsidy is removed, Nigeria revenue will jump up

BRIMBRAM:


In your imagination.

which part of the reality is imagination?

The government is having less money each year with increasing population and problems to solve.

post=123113646:

I pity you, you are done defending Buhari because his tenure is over na Tinubu now, when he was active as a governor he never reduce Lagos debt, today Lagos most indebted state, and all the states control by his men are seriously in debt, Tinubu can't give what he doesn't have, when his home state Osun was having economic turmoil, he did nothing only to remind them he is richer than the state, I pity you guys defending evil

The blind cannot see. We know he was the best governor and up till today his legacies are standing. Only those with good sight can see.