Disquiet over FG’s N2.34trn external loan request
…Request captured in 2021 budget – DMO
By Taofeek LAWAL and Joshua Elekwuachi, Abuja
Following President Muhammadu Buhari’s request to the National Assembly to borrow a fresh N2.34 trillion external loan, analysts have expressed that action will further plunge Nigeria into perpetual servitude.
Senate President Ahmed Lawal presented Buhari’s request to the senators at plenary on Tuesday.
Buhari stated that the money is meant to part-finance the budget deficit of N5.60 trillion in the 2021 budget.
A former federal lawmaker, Hon. Godfrey Ali Gaiya condemned in its entirety, the N2.4 trillion ($6.18billion) loan which the Federal Government is seeking to finance the 2021 budget deficit. According to the PDP chieftain, taking the loan when Nigeria is groping under economic pressure and difficulty is bad for the country.
He said adding the proposed loan to the one on ground is tantamount to mortgaging the future of the younger generations while adding that Nigeria is drifting towards modern day colonialism which will not augur well for the country as a sovereign nation.
He expressed the fear most loans that the government has collected are being channelled to areas that will not yield revenue to the economy.
He said, “It is obvious that the N2.34 trillion loan being borrowed by the Federal Government is one loan too many.
“If you look at the amount so far collected by this government as loan vis-a-vis the budget proposal or budget approval of N3.8 trillion, you will find out that 60 per cent of Nigeria’s national budget is predicated on loans and borrowing and this is not good for an economy that is entirely funded by loans from outside.
“So borrowing another N2.34 trillion at this time is not a welcome development.
“It is bad for our economy, bad for our nation and assuming we’ll have to pay which we must have to pay, then we are mortgaging then future of our younger ones who will start paying monies they are not party to.
“And if you look at what they use the money for, they are basically on recurrent expenditure, servicing of overhead costs, servicing personal emoluments, servicing salaries and cosummables.”
He said collecting the loan at this time is wasteful and needless. Gaiya, however, called on Nigerians to speak with one voice and said no to further loans that threaten Nigeria existence as a nation.
Meanwhile, Hon. Onu Nwonye, Member Representing Ohaozara West, Ebonyi state House of Assembly said, “We are just living on borrowed robes, it is said that he who goes a borrowing goes a sorrowing.
“With all this massive borrowing, we are mortgaging our future and the future of our children. No one promised us during the electioneering campaign that he was coming to pillage us with unnecessary borrowing.
“Most of the times you hear of borrowing, they only borrow to squander/Loot. Just like in Shagari days of presidency, borrowing was the order of the day until they plunged us into austerity measure. It is only government bereft of ideas that will live on borrowing and printing of money.”
However, the Debt Management Office (DMO) said President Muhammadu Buhari’s request for N2.343 trillion new borrowing was already captured in the 2021 budget.
The DMO made the clarification in tweets on Tuesday following Buhari’s request to the National Assembly to approve the new borrowing to fund critical capital projects in the 2021 budget.
DMO explained that proceeds of the loan were to be deployed to capital projects in various sectors of the economy.
“President Muhammadu Buhari has recently written a letter to the National Assembly requesting for the approval, by resolution of N2.343 trillion new external capital raising.
“The proposed new capital raising, is the New External Borrowing already provided for in the 2021 Appropriation Act.
“It will be recalled that the President signed the 2021 Appropriation Bill which included new domestic and new external borrowing into law after the approval of National Assembly (NASS),” DMO explained.
It added that the presentation to NASS was in fulfilment of an enabling debt management legislature.
“Accordingly, the new capital raising has already been approved and is now being presented to NASS in order to fulfil the provisions of Sections 21 and 27 of the Debt Management Office (Establishment, Etc.) Act, 2003.
“The proceeds are to be deployed to capital projects in various sectors of the economy including power, transport, agriculture and rural development, education, health and water resources that are included in the 2021 Appropriation Act.”
