Nigeria’s profile of debt remains at the front burner of the State-of-the-Nation discourse. It has recently become the argument of concerned stakeholders how the Country has been enmeshed in rising debt profile without concrete results to show for same. The concern has moved towards the edge of demands for a course for accountability on how loans acquired over time have been utilised. From every rational point, such demands would be justifiable given the noised expectations from loans acquired and the records of little or no impact felt by the populace. On critical grounds, it has been averred at critical point that the proceeds from loans have not yielded much, as the loans themselves have fallen into the web of corruption.
Known for its advocacy and demands for accountability, the Socio-Economic Rights and Accountability Project (SERAP) had last week filed a suit against the President Muhammadu Buhari-led Federal Government before the ECOWAS (Economic Community of West African States) Court over what it called “secrecy in the spending of loans so far obtained, the unsustainable level of borrowing by the government and the 36 states, the crippling debt burden. According to the right group, the acquisition of loans have been characterised with “lack of transparency and accountability in the spending of the loans so far obtained, and opacity around the terms and conditions in loan agreements, including repayment details for these loans.”
SERAP had noted that, “The Senate and House of Representatives recently approved the loans of $5,803,364,553.50 and a grant component of $10 million under the 2018-2020 External Borrowing (Rolling) Plan of the Federal Government. This followed previous approvals by the National Assembly of $16.2 (16,230,077,718) billion loan; &1 (1,020,000,000) million and a grant component of $125 million loan; $36.8billion, &910 million loans, and a grant component of $10 million; $8.3 billion and &490million loans; $6.1 billion, $1.5 billion and 995million loans; and $4(4,054,476,863), &710 million and grant component of $125 million.”
In the suit, filed before the ECOWAS Court of Justice in Abuja, last week by SERAP lawyers, Kolawole Oluwadare and Opeyemi Owolabi, the organisation is seeking an order directing and compelling the Federal Government to issue an immediate moratorium on borrowing by itself and the 36 states, in conformity with the country’s international human rights obligations. Also, SERAP is seeking an order directing and compelling the Federal Government to publish details of spending of the loans obtained by governments since 1999, including the list of projects and locations of any such projects on which these loans have been spent.
In its position on the subject, SERAP maintained that, “Persistent and unsustainable borrowing by the federal and state governments and the crippling debt burden undermine the rights of Nigerians to economic and social development, and are antithetical to the public interest. There is lack of transparency and accountability in the spending of the loans so far obtained, and opacity around the terms and conditions in loan agreements, including repayment details for these loans. The details of the projects on which the loans are spent are shrouded in secrecy. If not addressed, the escalating borrowing and looming debt crisis would cripple the ability of both the Federal Government and the 36 states to deliver, ensure basic socio-economic rights, such as quality healthcare, education, and clean water of the most vulnerable and marginalized sectors of the population. The Federal Government and many of the 36 states would seem to be in debt distress or at high risk of debt distress.”
The course of conscious assessment has evoked thoughts of what obtains for the Country at a time when rising challenges of dwindling revenue are the realities before the Government, with records of over 95percent of revenue going into debt servicing. The Country as noted may be heading for another debt trap with a debt stock of over N38trillion as officially recorded by September, 2021. While obtaining loans is not atrocious in its sense of reckon, it becomes reprehensible when they are not only wrongly applied, but also obtained on unfavourable terms, inefficiently utilised, and subjected to poor management. The resultant effects would only amount to heap of debts with no justification for their acquisition, nor the wherewithal to repay same. It has become sacrosanct for the Government to reform the structural patterns of its borrowing within the architecture of the character of public financing to satisfy the standards obtainable for sustainability to drive growth and development.