Minister of Information and Culture, Lai Mohammed, on Monday, assured Nigerians that there is no cause for alarm over the country’s debt profile.
Speaking with journalists on the major achievements of President Muhammadu Buhari’s administration for the outgoing year, Mohammed said there were misrepresentations in the figures about the debt profile, adding that the country had not reached its debt ceiling of 25 per cent in total public debt stock to Gross Domestic Product (GDP).
According to the minister, it is not correct to say that Nigeria’s external debt alone is $81.274 billion.
“The public debt stock is actually a cumulative figure of borrowings by successive governments over many years,” he said.
“It is, therefore, not appropriate to attribute the public debt stock to one administration. Nigeria’s total public debt stock in 2015 was 63.80 billion dollars comprising 10.31 billion dollars of external debt and 53.49 billion dollars domestic debt.
“By June 2019, the total debt stock was 83.883 billion dollars, made up of 27.163 billion dollars of external debt and 56.720 billion dollars domestic debt.”
The minister added that the debt service to revenue ratio has been higher than desirable, hence the push by the government to diversify the economy and increase oil and non-oil revenues significantly.
According to him, the government is also widening the tax base to capture more tax-paying citizens.
He said: “In the face of massive infrastructure decay, no responsible government will sit by and do nothing. This administration’s borrowing, therefore, is aimed at revamping our infrastructure, including roads, bridges, railways, waterways and power to help unleash the potential of the nation’s economy.
“The loans for the education sector will contribute to the development of our human capital, while the loans for the agricultural sector will help the move to diversify the economy.”
Former President Olusegun Obasanjo recently said Nigeria faces impending bankruptcy, with the country’s external debt ballooning by 700 per cent in four years.
