₦airaland Forum

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Baztardmods:
Endless Borrowing Will Lead to Endless Sorrowing.

By Atiku Abubakar.

John Quincy Adams once said “there are two ways to conquer and enslave a nation. One is by the sword. The other is by debt.” He may have very well been referring to Nigeria of the last three years.

Barely two weeks ago, I warned during my Founder’s Day lecture at the American University of Nigeria, Yola, that Nigeria had taken almost as much foreign debt in the last three years, as she had taken in the thirty years before 2015 combined. Now that is frightening. And very true.

Frightening, not just because of the amount, but because after such unprecedented borrowing, we have emerged as the world headquarters for extreme poverty and the global capital for out of school children. It begs the question: what were the funds used for?

I have said it time and again. The business of government is too serious to be left in the hands of politicians. We must all ask questions because if they throw away the future, it is not going to be their future they are throwing away, it will be all our futures.

The fact that Nigeria currently budgets more money for debt servicing (₦2.7 trillion), than we do on capital expenditure (₦2.4 trillion) is already an indicator that we have borrowed more money than we can afford to borrow. And the thing is that debt servicing is not debt repayment. Debt servicing just means that we are paying the barest minimum allowable by our creditors.

And while spending 50% of our current revenue on debt servicing, this administration wants to take further loans of $29.6 billion! To say that this is irresponsible is itself an understatement.

As a businessman, one of the very first things I learnt is that you do not take loans except you are expanding your business. Even as an individual, when your income cannot fund your lifestyle, you are challenged to grow your income, not your borrowings.

Even if this administration borrows $1 trillion, it will never be enough because their challenge is one of capacity. They are not using the funds they already have wisely. They do not need more debt. They need more intellectual capacity.

The money the Muhammadu Buhari administration wants to borrow to fund its Medium Term Expenditure Framework (MTEF) could be acquired without sinking the nation into further debt. All it requires is visionary leadership and business acumen.

In my economic blueprint, I said that rather than turn in regular losses (which it has consistently been doing), the best thing to do with the Nigerian National Petroleum Corporation is to reform it. Of course, the administration’s paid propagandists went into overdrive, accusing me of planning to sell the NNPC to my friends. But just last week, Saudi Arabia’s ARAMCO, the most profitable company in the world, took that route and almost broke the global stock market with the most successful initial IPOs in world history, bar none. Ironically, Saudi Aramco raised $29.4 billion via this IPO. Just the amount this administration wants to borrow.

That could have been Nigeria’s story, but for our failure of leadership. By reforming the NNPC, Nigeria can raise the $29.6 billion the Buhari regime wants to borrow, and we will raise the money without going into debt.

If we had taken that route, not only would we have attracted Foreign Direct Investment into Nigeria, but even better than investment, we would have attracted confidence in our economy, because it would have shown that we have a thinking leadership.

Take the example of the Nigeria Liquified Natural Gas company. This is a joint venture between the Nigeria government and the private sector. Yet, while the NLNG declares very handsome profits, in billions of dollars every year, the NNPC declares losses! This is proof that the NLNG model works, and the NNPC model does not.

Moody’s, the world’s preeminent rating agency, has just downgraded Nigeria. Ghana, a nation with only 15% of our population, now attracts more Foreign Direct Investment than Nigeria, and Rwanda, a country with less than 15% of our mineral endowment, has an economy that is growing at twice the rate of our economy. The problem is not revenue. The challenge is not Nigerians. The issue is leadership.

While there is scant information in the Medium Term Expenditure Framework for what the loan would be used for, I could not help but read a communication from the Presidency to the effect that one of such projects would be the digitalisation of the Nigerian Television Authority and other similar projects.

Spending revenue on such projects would be foolish, but spending loans in such a manner is nothing short of foolhardy. The Nigerian government does not have a good record of running businesses, and a public television network is unlikely to yield the type of income that would justify taking out loans to digitalise it. Besides, is that a priority, when we have 12 million children out of school? Like I said, capacity, not revenue, is the problem.

And in proof of this, I offer the example of how this administration took delivery of $322 million Abacha loot in 2018 and claimed it shared it out to poor Nigerians, only to obtain a $328 million loan from China, allegedly for ICT development the very next month. How do you share out $322 million and then borrow $328 million? Who does that? At the risk of repeating myself, it is clear that no amount of money, whether from revenue or borrowings, will be enough for an administration that lacks capacity.

So, what must Nigeria do now? Rather than profligate borrowing, what Nigeria needs to do is restore investor confidence in our economy. Key to that is respecting the independence of key institutions, such as the Judiciary and the Central Bank of Nigeria. Both of these institutions are now the captives of Buhari and his cabal, and though they are loathe to admit it, they cannot take one step without watching their backs.

Why are foreign investors leaving Nigeria for Ghana? The answer is that Ghana, unlike Nigeria, has learnt how to divorce key institutions from politics. The Ghanaian central bank enjoys a degree of independence that our own CBN can only dream of under the prevailing atmosphere. You will not hear Ghana’s leaders give flippant interviews overseas about their plans for the cedi, as Buhari has done in Europe about the Naira. It rang alarm bells because it is not the job of the executive to interfere in the role of the reserve bank.

Neither will you find Ghana’s leaders blatantly intimidating the judiciary by obviously setting up judges and invading courtrooms. Why would any investor come to Nigeria under such prevailing circumstances? Their thought would be that if they had industrial disputes, our courts, under this administration, could not be counted on to deliver impartial justice.

I was part of a team that paid off Nigeria’s entire foreign debt. I, therefore, cannot sit and watch an administration without vision squander our children’s future by taking and wasting loans that they do not even have the capacity to utilise properly.

Thank God for leaked memos that have exposed the lies this regime has told Nigerians about unprecedented revenues in the Federal Inland Revenue Service and the Nigerian National Petroleum Corporation. Now, we know that Nigeria is not poor because she is not making enough money. The truth is that Nigeria is poor because she is not making the right leadership decisions.

Thomas Jefferson said, “to preserve our independence, we must not let our rulers load us with perpetual debt.” Dear citizens of our beloved nation, this is a call to heed.

President Olusegun Obasanjo and I paid off this nation’s debt, and I will not stand idly by and watch while Nigeria is plunged into second slavery by those who only know how to reap where they have not sown.

Our youth must have something better to inherit from us than unsustainable debt fuelled by insatiable greed. That is why I call on the Senate of the National Assembly to show loyalty to Nigeria and reconsider its decision with regards to approving Buhari’s $29.6 billion loan request.

We need to pay heed to Benjamin Franklin’s advise that “he that goes a borrowing goes a sorrowing”. I call on Nigeria’s youth to identify the Senator representing their senatorial zones and write to them, urging them to vote against this request. Do this, because it is you and your children that will pay back these loans that would be squandered by this ravenous cabal who do not have the word enough in their vocabulary.

Source: https://m.facebook.com/story.php?story_fbid=10157827746884640&id=14312764639

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Most nigerians has being in the endless sorrowing you and your PDP bosses put them since you left sir..

What have we gained with assets under your leadership, sir ?.

Nigeria is a scam. Our politicians know what they are doing. They know there will be no Nigeria in some years to come so they want to borrow all they can before they will scatter Nigeria and by then you can't hold anybody accountable. I pity the people that borrow them money cos they are on a long thing. Nigeria will soon collapse. When your debtor die who do you hold?

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voltron14:
What are the important issues they aren't borrowing to solve?

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Sir, you have my full respect...well said

Dead and stinking meats seller is here viewing this tread. Food don land for you. What are you going to say about this, Biko?

NNPC that has become a liability. Losses evry year. Even Saudi has sold ARAMCo what is NNPC that can not be part sold. Abeg, we keep repeating the same mistake in the country that’s why we can never see change. Sell the Damm NNPC. Imagine borrowing money only to give National Assembly 37b for renovation. Nigeria is not a serious country.

Exc2000:




Shut up abeg.. Borrowing for infrastructure is better than selling NNPC


If this scumbarg Atiku and El'rufai didnt sell off Nigerian Asset like Nitel and Nigeria Airways or Delta Steel company rather than borrow single digit long term loan to revive the companies, Nigeria would be making extra income by now and we would have paid back the loans while keeping people employed



..

It's well

Abcdefghij10000:
Actually borrowing helps to ease the government from using public funds in which the public funds can b used for a more short time workable project. Let me englighten you lets say the government wants to build a capital intensive project of 1b$ like a light rail which the construction would take probably 4 years.Dont you think it would be at a disservice to the nation if almost half of the budget is used for this purpose while leaving some more pressing aspects of development like education and co. So borrowing would actually give the government another source of capital which would be used for the project while the budget can be allocated for other things

They do not need more debt. They need more intellectual capacity.

Nigeria strategy should not be about accumulating debt to improve infrastructures, how do we sustain those infrastructures by taking new debts. The country roads, rail, electricity plants and refineries are all comatose, because of poor governance model and corruption. Infrastructures are liabilities and unless the government has a plan for these infrastructures to be self-sustaining, the loans will end up in some politician Swiss account.

Coming from someone that sold public assets to himself. A man that shamefully sold public asset of $2.5 billion for $120 million should rather put work on how to redeem his image from what is boss Obasanjo wrote about him. The most importance thing about borrowing is to use the money for it purposes.

orunto27:
Do we know that Abacha's Loot of about N360billion would have transformed our 36 Constitutional States tremendously in Ranches and Husbandry if Buhari had shared the money N10billion per state.

aboki would always think in terms of cow.

Why should the federal government setup ranches? why not poultries? or fish farms?

What will endless looting leads to?

Tell that Audio El Sudani...someone that doesn't have 50years to live marring the lives of tomorrow's children

He has few points, country's interest first




The criticism is constructive enough




But, some half baked literates will only see reasons to spite instead of bringing out a few points

veraponpo:
This is half truth but full lie.

The only way to come out of this infrastructural decay is to invest in our infrastructures. Since we dont have huge funds to actualize this dream, the only plausible way is to borrow.

This infrastructure is what will build and boost our earnings repay our debts and give us better living.

You have a point here but.... Don't you think it would have made more sense to concession these infrastructure out.... Let the process be properly done to ensure ONLY those with adequate capital will buy them. They can recoup their money via charges for services and our kids won't have to pay for loans that don't make sense.
I still say.... Government has no business being in business.

naijapips04:
aboki would always think in terms of cow.

Why should the federal government setup ranches? why not poultries? or fish farms?

why would not FG set those things up? Why not chase technological excellence

The problem with Nigeria is that a lot of the so called leaders of industry did not get there by being true entrepreneurs. Since we know Atiku didnt borrow to build his businesses, we know he doesnt understand the concept of wealth creation

Baztardmods:
I am not sure you read that well, he didn't say its bad to borrow but this administration has been borrowing with nothing to show for it, part of what they want to use the fund for is to degitalize NTA while we have more important issues in the country to tackle. And they are accumulating funds we will be the ones to pay gradually in the future.. get that

Don't mind him, he is one of this incapable administration supporters, am sure he read it very well but you know any member of this current government turns truth upside down.

miteolu:
Written for Atiku, for Buhari. The Issue is Buhari does not read newspapers nor listen to radio.

Who says Buhari does not read?

As usual Zombies will dodge the message and attack the messenger.

Did you look at one of the items stated that the borrowed funds if granted, will be used for? To digitalise NTA? Is that any kind of industrialization that is remotely likely to improve the Nigerian economy? I am quite certain that if we are privy to the full details of what the money is meant for, we are likely to see more of such hopeless ventures plus highly overpriced infrastructural projects that can be done for far less, without any clear, viable repayment plan. How can we be talking about N37Billion now for remodeling the NASS? Does this give you the impression of a government prepared to diligently apply borrowed and available funds towards rapid & durable infrastructural development?

veraponpo:
This is half truth but full lie.

The only way to come out of this infrastructural decay is to invest in our infrastructures. Since we dont have huge funds to actualize this dream, the only plausible way is to borrow.

This infrastructure is what will build and boost our earnings repay our debts and give us better living.

What i do know is that Major General Buhari has never written a book.

Sincerely I didn't read d epistle, but d topic alone is rich

This was the same atiku who benefited immensely when they passed the argument that government had no business in business and privatized industries.

He became stupendously wealthy to such excess that even his principal had to fall out with him and outrightly called him a crook in his book.

Atiku is just singing songs to the PDP to get him in office in 2023 so he could conclude his rape of the Nigerian economy.

crackhouse:
Nigeria is a scam. Our politicians know what they are doing. They know there will be no Nigeria in some years to come so they want to borrow all they can before they will scatter Nigeria and by then you can't hold anybody accountable. I pity the people that borrow them money cos they are on a long thing. Nigeria will soon collapse. When your debtor die who do you hold?

you are one of the few people on nairaland with insight. I believe most politicians know Nigeria is doomed and they are just looting so they and their future generations are in a vantage position for what will eventually evolve from this contraption called Nigeria.

Bedwyr:
DISCLAIMER : I am not an APC supporter, I do not work for government in any capacity, nor am I a pro Buhari man, and have never in my life voted for PDP(except once in a Local government election, because there was no better alternative then)...or APC or its precursor parties...

Having got that out of the way...

1.In April 2014...oil prices fell....and kept on falling till in 2016, oil was at $30 per barrel, down from $75 per barrel in 2015...which was down from $120 in Jan 2014....

2.As things stand now, oil is at $60 per barrel.

3,Because of the drop in oil revenues, in order to keep our heads above water....WE HAVE HAD TO BORROW.

4.Also, as has been stated elsewhere...we need oil to be at least $100 per barrel before we can have a good economy( that is why in 2011-14, we had a good economy because oil was above $90 during those times).

5.As long as oil is below $100 per barrel, we would have to borrow. We have no choice.

6.If you want government to stop borrowing...good. I think so too. But that means that in return, salaries would not be paid at all, taxes would be at rates of 50-60% on everyone, including people earning below N50000monthly who are excluded from taxation,and our country would be broke. We would also have to remove subsides on everything..which means fuel would cost N300 and above per liter because now we cannot afford subsides.

7.Ultimately, borrowing has to continue....and EVEN if oil gets up to the ideal of $139 per barrel....which is where we need it not to borrow...we still have to pay off debts accruring previously.


We were here before , from 1982-1991, and again from 1992-2003.

The only way forward is simple....Nigeria must industrialse. Yes, it sounds fanciful, but we must take the hard road to industrialization. There is no ther way, and sadly APC nor PDP have the ideas we need.

We must also cut every subsidy in the fuel and power sector...so that we can save money and attract investors who will build our power and petrol sectors to the point where we can fuel our industrial development.

Nigeria must get off oil.

Now.

....If the strategy is to borrow to supplement infrastructures development and the national budget, what is the strategy to pay back this debt considering our low productivity income at $40 billion per annum? I would have suggested that the country sell the refineries and reduce her NNPC and NLNG stake with the IOC by 5% to release $30 billion that can be directed into infrastructures development. Cut in recurrence expenditure especially the cost of governance is required to boost the allocation to the national budget.

Mister man sit down
When you get their you will still borrow more than bubu.
APC and PDP is same.
Which country in the world doesn't borrow money?.
By 2023 u will still leave PDP for APC. Keep deceiving the mumu wey still believe that naija go better

sulaak:
....If the strategy is to borrow to supplement infrastructures development and the national budget, what is the strategy to pay back this debt considering our low productivity income at $40 billion per annum? I would have suggested that the country sell the refineries and reduce her NNPC and NLNG stake with the IOC by 5% to release $30 billion that can be directed into infrastructures development. Cut in recurrence expenditure especially the cost of governance is required to boost the allocation to the national budget.

Add fuel subsidy removal...and we might even save more....

But Nigerians don't like the idea of making NNPC more private or selling the refineries ….because it means higher fuel prices.

Privatising the refineries, means that the cost of production is going to go up....and that means that a subsidy won't be the answer...as the owner of the private refinery would be operating at a loss...SO It has to go.

Which would lead to riots...

But I like your idea. Pity most Nigerians don't like it.

(Also making NNPC private run reduces the glorious opportunities for corruption there. No way any gofment would allow that...).

Bedwyr:
DISCLAIMER : I am not an APC supporter, I do not work for government in any capacity, nor am I a pro Buhari man, and have never in my life voted for PDP(except once in a Local government election, because there was no better alternative then)...or APC or its precursor parties...

Having got that out of the way...

1.In April 2014...oil prices fell....and kept on falling till in 2016, oil was at $30 per barrel, down from $75 per barrel in 2015...which was down from $120 in Jan 2014....

2.As things stand now, oil is at $60 per barrel.

3,Because of the drop in oil revenues, in order to keep our heads above water....WE HAVE HAD TO BORROW.

4.Also, as has been stated elsewhere...we need oil to be at least $100 per barrel before we can have a good economy( that is why in 2011-14, we had a good economy because oil was above $90 during those times).

5.As long as oil is below $100 per barrel, we would have to borrow. We have no choice.

6.If you want government to stop borrowing...good. I think so too. But that means that in return, salaries would not be paid at all, taxes would be at rates of 50-60% on everyone, including people earning below N50000monthly who are excluded from taxation,and our country would be broke. We would also have to remove subsides on everything..which means fuel would cost N300 and above per liter because now we cannot afford subsides.

7.Ultimately, borrowing has to continue....and EVEN if oil gets up to the ideal of $139 per barrel....which is where we need it not to borrow...we still have to pay off debts accruring previously.


We were here before , from 1982-1991, and again from 1992-2003.

The only way forward is simple....Nigeria must industrialse. Yes, it sounds fanciful, but we must take the hard road to industrialization. There is no ther way, and sadly APC nor PDP have the ideas we need.

We must also cut every subsidy in the fuel and power sector...so that we can save money and attract investors who will build our power and petrol sectors to the point where we can fuel our industrial development.

Nigeria must get off oil.

Now.

So you mean we have to borrow and fill in deficits and then hope we have surplus, enough to service or pay off debts.
Hope is not a good word.
Our nation can and should live within her means.


As long as I am concerned.
School feeding program is crap.
N10,000 Tradermoni is crapper.
And then the millions recovered from returned Abacha loot that was said to have been distributed to the poor is crappiest.
Borrowed Abuja CCTV fund, a complete trash.
$500M Abuja-Kaduna rail, is actually headed to be crap. Cos generated revenue cannot pay all staff salaries, talk more of service the loan. The best they would have done was to maintain the road and ensure the road is safe.

There are other many instances of very crappy things happening in this country.

Who else thinks that N250something million find for 2019 general elections was the crappiest thing that ever happened.


So if you say <$100 is a good cause to borrow, I will show you many instances where the little we think we have might have been over enough.

hinere:
I couldn't even read the post to the end....

Now he has mouth to be talking....

D little part u read, what did it say?