Nigeria’s N35.5trn debt, humongous rise in FG’s expenditure profile worry NECA

Nigeria’s rising debt profile and financing infrastructure deficit with foreign loans has been criticized by the Nigeria Employers Consultative Association (NECA), calling it sustainable.

NECA said rather than for the Buhari administration to continue to take loans to finance “critical infrastructure”, it should adopt the Public Private Partnership (PPP).

According to the Director-General of NECA, Dr Timothy Olawale,, the nation’s rising debt profile is not sustainable as the government is committed to addressing the huge infrastructure deficits in the country.

Persecondnews recalls that last week, Information and Culture Minister, Alhaji Lai Muhammed, had justified the Federal Government’s borrowing, saying it has a lot to show for loans taken so far.

He described those criticizing Buhari’s administration for borrowing as insincere.

“Adopting the PPP approach to financing infrastructure deficit is the best in a very short term and at a cheaper rate.

“We applaud the mammoth infrastructural development being carried out by this administration since inception; however, it is our belief that more can be achieved with the huge natural, human resources and capabilities available within the economy, if managed appropriately.

‘’Not to say the least, the debt profile currently at N35.5trillion is worrisome and unsustainable for an economy like ours,” Olawale said.

The Director-General also said NECA is more worried about the sharp rise in expenditure profile of the government against marginal increase in the nation’s revenue.

“We are more concerned by the unprecedented and humongous rise in the expenditure profile vis-à-vis the revenue, which grew by over 102% between 2015 and 2021 with a trifling rise of revenue by only 15% within same period from both non-oil and oil revenue.

‘’The Association is more concerned with a growing economy, where every economic concern generates sufficient revenue that could pay-off reasonably its debt provisions with less impact on its future earnings and accumulate huge foreign reserves.

“As infrastructural provision is critical to any development for any economy with robust and friendly business environment, we call for more collaborative efforts in the form of Public Private Partnership, PPP, in addressing the huge infrastructure deficits, in a very short term and at cheaper rate.

‘’It is our belief that implementing the PPP initiative in provision of the country’s critical infrastructure, decent and sustainable jobs will be provided and desirable number of people will be lifted from the poverty rank even before the desired date of 2030.

‘’More so, there is need to review the rising cost of governance and block the leakages in governance, which is becoming a clog to development,” Olawale said.