The International Monetary Fund on Monday expressed concern over Nigeria’s capacity to repay its debts and stressed the need for the Federal Government to mobilise more revenues domestically.

The Washington-based fund, at the public presentation of the Spring 2018 Issue of the Regional Economic Outlook for Sub-Saharan Africa, said the public debt in the region was on the rise.



IMF Senior Resident Representative and Mission Chief for Nigeria, Amine Mati, said, “The number of countries in debt distress has increased. From six countries in 2014 to eight in 2015, to 10 in 2016, and today 15 countries. These are low-income economies.

“Now, I know the question that is going to come from here is: Where is Nigeria? Nigeria is not considered a low-income economy. Nigeria’s debt stock figure, which is 20 to 23 per cent of Gross Domestic Product, is still quite low by any standard. The issue is capacity to repay the debts. So, interest payment to revenue is an issue.”

On the need to ramp up domestic revenue mobilisation, Mati put Nigeria’s total revenue at six per cent of GDP.

“There is a lot that can be done to increase revenue very quickly,” he said.

Noting that Value Added Tax rate had been quite low in Nigeria, he said doubling the compliance on VAT from 25 to 50 per cent would increase the VAT ratio from 0.9 per cent of GDP to close to two per cent.

Nigeria’s debt stood at N21.73tn as of December 31, 2017, compared to N12.12tn as of June 30, 2015, according to the Debt Management Office.

The DMO had said the composition of the debt stock as of the end of 2017 showed that external debt was 26.64 per cent of the portfolio, up from 20.04 per cent in 2016, while the domestic debt was 73.36 per cent, down from 79.96 per cent in 2016.

The Director-General, DMO, Patience Oniha, in her remarks at the event, said the government had been working aggressively to shore up revenues as well as reduce borrowing costs.



“The debt service is a function of the interest that you pay on those borrowings as well as your revenue. The critical part is that revenue has been low relative to the size of the GDP. So that has to go up,” she said in an interview on the sidelines of the event.

According to her, there is an aggressive drive to raise revenues through the Voluntary Assets and Income Declaration scheme.

Oniha said, “What are we doing on debt service? The new debt management strategy, which we started implementing last year, seeks to moderate the growth of interest expense by shifting some of the borrowing externally.

“If we were borrowing on the domestic market, last year we would be borrowing at about 16 to 17 per cent and early on the year, 18 per cent. But we went to the international market. So rather than borrow that $4.8bn that we borrowed in the international market in the domestic market, we borrowed at below eight per cent. If we raised the money in the domestic market, we would have had to pay those high rates.”

The DMO DG said the government saved over N70bn from, estimated on a per annum basis, from that exercise.

“We are still borrowing because there are provisions for borrowing in the budget. But in terms of how much it cost us to borrow, we are working actively on reducing that and reducing the refinancing risk that we had with Treasury bills every 90 days, every six months.”

source: http://punchng.com/imf-doubts-nigerias-capacity-to-repay-debts/

How will they be able to pay, when they are servicing the northern oligarchs that has been able holding the country since 1960. They will start using islam to deceive their people

Where is kaduna state government that want borrow money he can’t pay

The IMF I know is a gang of greedy loan sharks looking for who to devour...

Nigeria doesn't need IMF loan....

IBB, OBJ and GEJ gladly took from them but Buhari won't. He didn't in 1983... He won't now cos he knows IMF is always up to no good with their useless loans

Ok

Na now una know? Receive sense

So Buhari doubled national debt in just 3 years? The level of corruption in this government makes Abacha look like a saint.

This country matter just weak me...

THE DAWN IS NEAR!!!!!!

36STATES:
So Buhari doubled national debt in just 3 years? The level of corruption in this government makes Abacha look like a saint.

We need to split this country.... How can OBJ work so hard for debt relief only for some drunken and illiterate President to take us right back into debts?!!!

and we have a president who took his time to come with an economic plan

OK na

we no dey panic, we can pay with nigeria as a whole

U guys can sell the country to finance the payment of debts. Am tired of this shithole

Nigeria to IMF: I beg sir, forgive us our debts.

9ja.

Why borrowing us the money in the first place ?

Bunch of crazy people.

When you borrow what you can not offset in your own lifetime/regime, you're putting shackles of bondage on upcoming generations.
Serious nations borrow for something tangible (revenue generating or socio-economic beneficial capital projects). But what you expect from a country whose annual budget is less than more than 70% recurrent? The money is going into the pockets of few individuals, this is in Nigeria, it doesn't matter if the annual budget is #20 trillion, the man on the street would never feel the impact.
It be right to ask the government of Buhari what he did with close to #10 trillion he borrowed in the last 3 years (of course, 95% of it is in the pockets of 5%- the real 5%).
If Nigeria didn't borrow a penny during the civil war, I wonder the rationale behind all this borrowing when we have other means to generate revenue we need.
Later now, some people will say the youths are lazy.
Laziness is when the government have to put the country in debt, while there are other means to generate income.

deji17

BlackAfrican:
The IMF I know is a gang of greedy loan sharks looking for who to devour...

Nigeria doesn't need IMF loan....

IBB, OBJ and GEJ gladly took from them but Buhari won't. He didn't in 1983... He won't now cos he knows IMF is always up to no good with their useless loans

You know nothing about the IMF

BlackAfrican:
The IMF I know is a gang of greedy loan sharks looking for who to devour...

Nigeria doesn't need IMF loan....

IBB, OBJ and GEJ gladly took from them but Buhari won't. He didn't in 1983... He won't now cos he knows IMF is always up to no good with their useless loans

IBB took a loan from the IMF ? I think you need to brush up on your history.

Rubbish somefin dey like colonial slavery imf up to no good

grandstar:


You know nothing about the IMF

It's run by Jews. That's enough to tell you everything you need to know.

BlackAfrican:
The IMF I know is a gang of greedy loan sharks looking for who to devour...

Nigeria doesn't need IMF loan....

IBB, OBJ and GEJ gladly took from them but Buhari won't. He didn't in 1983... He won't now cos he knows IMF is always up to no good with their useless loans

What are you yapping? We have doubled our debt profile in 3 years.

Esseite:


What are you yapping? We have doubled our debt profile on 3 years.

To a whole blackafrican??

BlackAfrican:
The IMF I know is a gang of greedy loan sharks looking for who to devour...

Nigeria doesn't need IMF loan....

IBB, OBJ and GEJ gladly took from them but Buhari won't. He didn't in 1983... He won't now cos he knows IMF is always up to no good with their useless loans

Comprehension Comprehension!

The report indicates that Nigeria's debt has already increased from N12t in 2015 to N21t under Buhari.
Yet not a single project can be seen to be started and finished in the last 3 years.

We go sale Buhari and zombies to potential buyers to raise money...they are useless to us anyway!!!!

Paperwhite:
And yet they are urging poor third world countries to get more neck-tightening debts for developmental projects.

The problem is, where are the projects infrastructures which we used in borrowing that are supposed to pay the debt overtime?

Hmmm, APC killing Nigeria & Nigerians very fast! Thank God that I have my international passport & visa ready.