Obasanjo Decries Nigeria’s Rising Debts, Low FDI

Posted by African Examiner Featured, Latest Headlines, News Across Nigeria, News From The State Sunday, August 22nd, 2021

(AFRICAN EXAMINER) – Former President Olusegun Obasanjo has expressed worry over the way states and the Federal Government are accumulating debts as well as over the low foreign direct investment into the country.

Obasanjo spoke in Abeokuta, Ogun State, when he hosted some members of the National Working Committee of the People’s Democratic Party, led by its Chairman, Prince Uche Secondus, at the Olusegun Obasanjo Presidential Library.

At the meeting, Obasanjo was said to have expressed worry about the way the country had been busy accruing debts by borrowing money all over the world.

While in office, the former president visited the country’s creditors and was able to get debt forgiveness for the country.

However, since assuming office six years ago, the regime of the President, Major General Muhammadu Buhari (retd), had been accumulating debts for the country.

Investigations in May indicated that the country’s debt rose by N20.8tn between July 2015 and December 2020, according to data obtained from the Debt Management Office. The period falls under Buhari’s regime, which began on May 29, 2015.

Statistics obtained from the DMO showed that Nigeria’s total debt as of June 30, 2015 stood at N12.12tn.

However, as of December 31, 2020, the country’s debt portfolio had risen to N32.92tn.

This shows that within a period of 66 months (five and half years), the country’s debt has risen by N20.8tn. It also means that within the period, the country’s debt portfolio rose by 171.62 per cent.

Most of the country’s debt was incurred by the Federal Government. Of the total debt of N32.92tn, the Federal Government has a total of N26.91tn, leaving a balance of N6.01tn to sub-national governments, mainly, the 36 state governments and the Federal Capital Territory Administration.

The implication of this is that 83.78 per cent of the nation’s debt stock belongs to the Federal Government, with the sub-national government accounting for 16.22 per cent.

Further analysis shows that domestic sources accounted for N20.21tn while external sources accounted for N12.71tn.

Sources at the meeting disclosed that the former president Obasanjo was disheartened over the unbridled way the current leaders of both the country and states were borrowing to either finance budgets or even pay salaries.

One of the sources said the former president informed his guests that while he was in office, governors always informed him about how much they had been able to attract as FDI into their states.

The source said, “The former president told us that every nation must source funds within to finance projects and be able to attract FDI to it.

“For example, he said then, he was always happy when governors would call to tell him that they had about $100m from FDI. He would be happy. But now, all the money he also left behind in foreign accounts have been taken.

“He said all he hears about now is debts and loans. He insisted that the country must produce leaders that would know how to turn the economy around and also attract foreign investors. The former president is very passionate about the country and that is very amazing.”

(PUNCH)